Blended Petrol Market

Blended petrol Market Overview:

Global Blended petrol Market: Global Size, Trends, Competitive, and Historical & Forecast Analysis, 2024-2030. Rising demand for eco-friendly alternatives, stringent environmental policies favoring cleaner fuels, and innovative blending technologies converge in the blended petrol market, creating a dynamic landscape for sustainable, high-performance driving experiences. Global Blended petrol Market is valued at USD xx Billion in 2023 and it is expected to reach USD xx Billion by 2030 with a CAGR of 21.3% over the forecast period.

Scope of Global Blended petrol Market Report:

Blended petrol, also known as ethanol-blended petrol or E10, is a type of fuel that combines traditional gasoline with a certain percentage of ethanol. Ethanol is typically derived from renewable sources like corn or sugarcane. The blending of ethanol with petrol is done to reduce the environmental impact of fuel consumption and to promote the use of renewable energy.

The most common blend is E10, which contains 10% ethanol and 90% petrol. This blending has been introduced in various countries as a measure to reduce greenhouse gas emissions and dependence on fossil fuels. The use of blended petrol is often seen as a way to address environmental concerns, enhance energy security, and support the agricultural sector by creating a market for biofuels.

Blended petrol has become more prevalent in response to global efforts to mitigate climate change and transition towards more sustainable energy sources. However, the adoption and availability of blended petrol can vary from region to region, depending on government policies, infrastructure, and the overall commitment to promoting renewable energy solutions.

Revenue Generation Model:

The revenue generation for companies involved in blended petrol manufacturing typically comes from various sources. The primary source of revenue for blended petrol manufacturing companies is the sale of blended fuel to consumers through petrol stations. E10 is commonly used as an alternative to traditional gasoline, and companies earn revenue based on the volume of blended petrol sold. In some regions, governments may provide incentives or subsidies to encourage the production and use of blended petrol, Manufacturers can benefit from these programs.

Additionally, players involved in blended petrol manufacturing may engage in research and development activities to improve fuel efficiency and reduce emissions. So, they can generate revenue by offering their expertise or selling proprietary technologies to other industry players.

Supply Chain Analysis:

The supply chain begins with the extraction of crude oil from oil fields. This crude oil is transported from extraction sites to refineries through pipelines, tanker ships, or railways. Then this crude oil undergoes a refining process to separate it into various components, including gasoline. The base gasoline obtained from the refining process may undergo further blending to meet specific quality and performance standards. Blending involves combining different components and additives to achieve the desired fuel properties.

After blending, it is transported from refineries to distribution centers through pipelines, tanker trucks, or a combination of both. At distribution centers, blended petrol is stored in tanks before being transported to retail outlets. Finally, the blended petrol is delivered to retail gas stations where consumers can purchase it. Retail outlets typically store petrol in underground tanks and dispense it to customers through pumps.

Value Chain Analysis:

The value chain for blended petrol involves various processes, from production to consumption. Ethanol is produced through the fermentation of sugar and other organic matter, such as sugarcane or food grains. The blending of ethanol with petrol is carried out at designated blending units. Once blended, the fuel is distributed to retail outlets through an established distribution network. The consumption of blended petrol has several significant impacts. Firstly, it reduces carbon monoxide emissions, with studies showing a 50% reduction in two-wheelers and a 30% reduction in four-wheelers with 20% ethanol blending.

Furthermore, blended petrol has several important advantages. It reduces environmental degradation by reducing emissions and promoting sustainable practices. The blending of ethanol also provides an additional income source for farmers, especially those involved in sugarcane cultivation.

COVID-19 Impact on Blended petrol Market:

The COVID-19 disrupts both supply and demand dynamics in the blended petrol market. With lockdowns and restrictions imposed globally, there was a significant reduction in travel and economic activities, leading to a sharp decline in fuel consumption. As a result, demand for blended petrol, which typically includes a mix of ethanol or other biofuels with traditional gasoline, experienced a notable contraction. The 11.6% drop in global production to 146 billion liters, according to the International Energy Agency (IEA), was the first reduction in annual production in two decades. This decline in demand and production, coupled with disruptions in the supply chain, created a challenging environment for the blended petrol market.

Additionally, the pandemic highlighted vulnerabilities in the energy sector, prompting increased scrutiny on supply chain resilience and the need for diversified and sustainable energy sources. 

Key Players of Global Blended Petrol Market Report:

The global blended petrol Market report encompasses major players, including ExxonMobil, Royal Dutch Shell, Chevron Corporation, BP (British Petroleum), Total Energies, ConocoPhillips, Saudi Aramco, Gazprom, ENI, PetroChina, Sinopec, Rosneft, Pemex (Petroleos Mexicanos), Valero Energy Corporation, Phillips 66, Marathon Petroleum Corporation, Lukoil, Repsol, ENOC (Emirates National Oil Company), ADNOC (Abu Dhabi National Oil Company), Hess Corporation, CNOOC (China National Offshore Oil Corporation), Reliance Industries, SK Innovation, Petronas, and others, who play a significant role in shaping the market landscape.

Market Drivers:

Blending Ethanol with Petrol is a as a Key Strategy for Sustainable Development Pool Accelerates the Market Growth:

Ethanol is a renewable fuel that can be blended with gasoline to reduce emissions. Ethanol is derived from plants and is a less polluting, efficient, and lower-cost alternative fuels. Ethanol is a renewable fuel that burns more cleanly and completely than gasoline. Ethanol use reduces greenhouse gas emissions by 44–52% compared to gasoline. It also has a higher-octane number than gasoline, which makes it a good blending agent. Ethanol blending is the process of mixing ethanol, a renewable fuel, with gasoline. It is a key strategy for sustainable development and climate change mitigation; as it can reduce greenhouse gas emissions, improve air quality, and support the agricultural sector.

Blended Petrol Market is Growing Due to Rising Promotion from Government Policies Regarding Use of Renewable Energy Sources:

Blended petrol is a renewable energy source because it contains ethanol, a plant-based fuel. Ethanol is produced from renewable biomass sources, such as corn, sugarcane, and another biomass. The Clean Power Plan aims to reduce carbon emissions from power plants and encourages the use of renewable energy. For example, China has implemented various policies to promote renewable energy, such as feed-in tariffs, subsidies, and tax incentives for renewable projects. Also, India has set a target to reduce the carbon intensity of the nation's economy by less than 45% by the end of the decade. Petrol blended with 20 per cent ethanol was rolled out on February 6, 2023, at select petrol pumps in 11 states and union territories as part of a program to increase use of Biofuel for Vehicles to cut emissions as well as dependence on foreign exchange-draining imports.

Market Restraints:

Poor Older Fuel Infrastructures Led to Restrict the Market Growth:

Blended petrol is sometimes posing challenges for older fuel infrastructure due to differences in properties and corrosiveness. Retrofitting or upgrading existing infrastructure may be necessary to accommodate these blends. This could involve changes to storage tanks, pipelines, and dispensing equipment to ensure they are compatible with the blended fuel. Ethanol, commonly used in biofuels, can be corrosive to certain materials used in fuel infrastructure. Over time, this can lead to damage and deterioration of pipes and storage tanks, potentially causing leaks and safety hazards.

Less Compatibility of Blended Petrol in Some Vehicles Limits the Market Expansion:

If the car is designed to run on E20 petrol, then it should be safe to use. However, the car's engine is not designed for this fuel, so using E20 petrol can cause engine damage and void the warranty. The engines and fuel systems of certain vehicles may not be designed to handle higher ethanol content, leading to potential damage or decreased performance.

For example, in general, most BS4 and BS6 phase 1 cars in India are not designed to run on E20 petrol. A 5% blend may not affect the engines, but a 10% mix could create problems. The increase in the amount of ethanol could result in damage to some plastic, rubber and aluminum components. And this could affect fuel efficiency a bit.

Thus, to overcome this hurdle manufactures need to invest in research and development to increase the compatibility of blended petrol.

Opportunity Factors:

Growing demand for alternative fuels:

The scarcity of known petroleum reserves will make renewable energy resources more attractive. The most feasible way to meet this growing demand is by utilizing alternative energy sources, such as blended petrol. The growth of the alternative fuels industry can lead to an increase in revenue from research and development to manufacturing and distribution. This can positively impact local economies.

Consumer Awareness and Acceptance:

Public awareness and acceptance of blended petrol are essential. Marketing efforts and educational campaigns can help in promoting the benefits of using blended petrol, such as lower emissions and potential cost savings. Higher reductions in Carbon Monoxide emissions were observed with E20 fuel – 50% lower in two-wheelers and 30% lower in four-wheelers. Hydrocarbon emissions are reduced by 20% with ethanol blends compared to normal gasoline.

Improved fuel efficiency:

Blended fuel burns more efficiently than pure gasoline. According to MIT and Honda R&D, E20 can improve relative efficiency by up to 20% compared to normal gasoline. This research can become a significant opportunity for blended petrol market players.

Blended petrol Market Trends:

Changes in the automotive industry, including the development and promotion of flex-fuel vehicles capable of using higher ethanol blends, are market trends for blended petrol. Advances in technology have made it more feasible and cost-effective to produce and blend biofuels with gasoline. This has further facilitated the integration of renewable fuels into the mainstream fuel supply.

Increasing public awareness of environmental issues and the desire for cleaner and sustainable energy options contribute to the demand for blended gasoline. Consumer preferences for environmentally friendly products have led to the adoption of biofuels in the transportation sector.

Notably, some consumers prefer using fuels with a lower environmental impact, and the availability of blended petrol allows them to make more sustainable choices. Marketing efforts that highlight the environmental benefits can influence consumer preferences.

Market Competition Nature:

The petroleum industry is highly competitive and involves numerous players globally. The market players are involved in organic as well as inorganic growth strategies. In organic strategies the market players are focusing on product launch, business expansion, technological investment etc. Additionally, in inorganic growth strategies companies are concentrating on acquisitions, partnerships, collaborations etc.

Furthermore, as top market players are constantly focusing on marketing strategies to stay ahead in the market competition. On the other hand, growing government support leads to creating a path for the new entrants in the market which upsurges the competition for tier-2 market players. The petroleum industry’s competition is also influenced by geopolitical factors, regulatory changes, and the global demand for blended petrol.

Past strategies by key market players:

Offered incentives to retailers, such as subsidies or promotional support: By employing this strategy, blended petrol companies were success to create a supportive environment for retailers, incentivizing them to promote and sell their products effectively, ultimately lead to increased sales. For example, Shell offers some types of incentives and commission to retailers on all fuel sales.

Petrol companies offer subsidies to retailers who purchase blended petrol in bulk: This can reduce the overall cost for retailers, allowing them to maintain competitive prices and potentially attract more customers.

Offering volume-based discounts to retailers encourages them to sell more blended petrol: Retailers can benefit from lower unit costs as they achieve higher sales volumes, creating a win-win situation for both the company and the retailer.

Future strategies by key market players:

Launch awareness campaigns to educate the public about the benefits of blended petrol: Address any misconceptions and provide clear information about its positive impact on the environment and vehicle performance. Because for the change the mindset of customers towards the use of blended petrol awareness campaign is very important.

Work closely with automakers to ensure that vehicles are compatible with blended petrol: Collaborate on research and development to improve engine efficiency and performance with blended fuels. This strategy will be helpful for the increased sales of blended petrol.

Geography Analysis:

How Government Initiatives Drive the Growth of Blended Petrol Market in Europe Region?

In Europe, the use of biofuels in petrol blends is influenced by EU directives and regulations aimed at promoting renewable energy and reducing carbon emissions. The EU has set targets for the share of renewable energy in the transportation sector, and biofuels play a role in meeting these targets.

Correspondingly, In Feb. 2023 the European Union agreed on an order for all flights departing the bloc to use Clean Fuel Solutions made from waste oils or surplus renewable energy, beginning with a 2% blend in 2025 and increasing to 70% by 2050. The move, announced on 26 April 2023, represents a bid to jumpstart the sustainable aviation fuels industry, in a region already politically invested in technology. Nowhere else is there a standing clean jet fuel mandate, though interest in such policies is rising outside of the EU.

In view of this, Various European countries have implemented blending mandates, specifying the percentage of biofuels that must be included in petrol sold in the market. The specific regulations and targets can vary from country to country.

In Asia, several countries have been exploring and implementing Blended Petrol to address environmental concerns:

Blended petrol typically refers to a mixture of conventional gasoline and biofuels. Biofuels are often blended with traditional fossil fuels to reduce greenhouse gas emissions and promote sustainability. 

In addition, Malaysia currently requires a 20% blend of biofuels, primarily from palm oil, in its car fuel mix and subsidizes road fuels in general. Aside from Malaysia, neighboring Indonesia has a 35% biodiesel blending mandate for land transport, which was recently increased from 30% in February 2023. The two countries account for the bulk of the global palm oil supply.

Furthermore, Market players in Asia are grappling with the implications of such rules for both aviation and road car fuel blends. For governments, the policy instrument is considered as helpful in assisting the embryonic transportation biofuel industries in achieving economies of scale and lowering prices. However, industry participants warn of problems, such as effects on trade flows and competitiveness.

Key Benefits of Global Blended petrol Market Report–

• Global blended petrol Market report covers in-depth historical and forecast analysis.
• Global blended petrol Market research report provides detailed information about Market Introduction, Market Summary, Global market Revenue (Revenue USD), Market Drivers, Market Restraints, Market Opportunities, Competitive Analysis, and Regional and Country Level.
• Global blended petrol Market report helps to identify blended petrol market challenges.
• Global blended petrol Market report covers an extensive analysis of emerging Blended petrol and the competitive landscape.

Global Blended Petrol Market Segmentation: -

By Blending Component:

• Ethanol-Blended Petrol
• Methanol-Blended Petrol
• Others

By End-user

• Individuals
• Commercial Operators

By Distribution Channel

• Retail Stations
• Bulk Distributions
• Online Platforms

By Regional & Country Level:

• North America
  • S.
  • Canada
• Europe
  • K.
  • France
  • Germany
  • Italy
• Asia Pacific
  • China
  • Japan
  • India
  • Southeast Asia
• Latin America
  • Brazil
  • Mexico
• Middle East and Africa
  • GCC
  • Africa
  • Rest of Middle East and Africa