Middle east and africa Biodiesel Market

The Middle East and Africa Biodiesel Market Size 2023-2028

The Middle East and Africa Biodiesel Markets are likely to develop at a compound annual growth rate of 5.8% over the foreseen period between 2023-2028

The Middle East region contributed to more than 36% of the liquid production, on top of this, it is also the second-largest producer of gas in the world. Renewable resources have contributed to around 6% of the total installed capacity in the region.

Drivers and Restraints of the Middle East and Africa Biodiesel Market

The African biodiesel market is witnessing increasing demand as more people are purchasing vehicles. The regional automotive engine oils market roughly accounts for 6% of the total world market. In recent times, the purchasing power of consumers is also increasing in Africa which has proved to be very lucrative for the biodiesel industry. In the Middle East region, which is often called the petrochemical economy, high-performing engine demand has increased. Mechanical engineering has taken leaps forward to provide customers with the best-designed vehicles. On top of that, infrastructure in the Middle East has rapidly increased and this has triggered the demand for more lubricants. These countries bestow their architectural brilliance to the world and with the 2022 FIFA World Cup scheduled in Qatar, the bio-based oil market has significantly gone up. All these improvements and evolution improved the demand for better lubricants which eventually led the biodiesel industry to grow and evolve. Biodiesels provide better alternatives to the existing fuels, as they are more eco-friendly and go well along with the stringent environmental rules.

Even though the national purchasing power is growing, the overall purchasing ability of the residents in Africa is significantly less than the world average. The shortage of investments in these industries is slowing their development. The Middle East is a global hub for oil, but electric vehicles are slowing down the popularity of conventional vehicles and thus demand is decreasing. During the COVID-19 pandemic, oil prices dropped to a negative value in this area.  

The biodiesel market has been segmented into the following categories:

On the basis of the Feedstock Type:

• Animal Fat

• Vegetable oils

• Brown Grease/Trap Grease

On the basis of Application:

• Fuel
• Power generation

The Automobile engine oil industry is heavily dependent on the growth and functioning of the automobile industry. Qatar’s oil industries have registered a growth of 1% CAGR over the forecasted period. High-mileage engine oils are finding increased demand among the end-users. In Africa, a huge boom in the wind energy sector has increased the demand for oil, this is applicable to engine oil, grease, and hydraulic fluids. With fluidized bed boilers gaining popularity, demand for biodiesel oil has also increased.

Geographical overview and regional presence:

In Saudi Arabia, the industry is expected to grow at a CAGR of 1% in the forecast period. Petromin is a leading company in Saudi Arabia that is rapidly expanding its operations in the biodiesel business.

In Qatar, the light motor vehicle segment recorded the highest consumption rate of engine oils. Thanks to the technological improvements and government policies that led to the requirements for fuel economy, the automakers have been manufacturing lighter vehicles with tighter tolerances

The Middle East and Africa Biodiesel Market Recent Developments:

• Petromin-Nissan is continuing rapid expansion with the first dealership & showroom in Khobar, Saudi Arabia.

• Aljomaih and Shell Lubricating Oils (JOSLOC) have developed and launched the world’s largest oil bottle that can contain almost 1,000 liters of Shell Helix Ultra 5W-40 motor oil, along with PurePlus technology.

There are several major market players that are strengthening their dominance in the Biodiesel Market in recent years, some of the big names in the Middle East and Africa are:

1. ExxonMobil Corporation

2. Petromin        

3. Behran Oil Co.

4. Aljomaih And Shell Lubricating Oil Company Limited

5. FUCHS

Impact of COVID-19 on the MEA Biodiesel Market:

The COVID-19 pandemic has hit the Middle East and African lubricants market severely, pre COVID-19, the market was attracting huge investments as people were becoming more capable of spending more money. But with the coronavirus outbreak, all the investments came to a standstill. Construction work has been stopped because as most of the infrastructure companies had to pause their work. Even though African countries have been least impacted by the virus, economic effects have been felt in every industry.

Middle East oil market has also dropped, as major airlines such as Qatar Airways, and Etihad Airways had to completely stop their functioning and thus no demand for lubricants was seen. Construction projects were also halted which added to the woes of the lubricant industry. The oil prices also touched negative value in this period and several companies have been asked to determine their liquidity levels to combat bankruptcy.