The North America oil storage market has emerged as a crucial player in the global energy landscape, navigating through dynamic shifts in demand, prices, and geopolitical influences. Valued at $667 million in 2016, the market is projected to reach $931 million by 2023, showcasing a steady compound annual growth rate (CAGR) of 4.8% from 2017 to 2023. This growth is mirrored in volume, with the market poised to expand from 54,154 thousand cubic meters (CBM) in 2016 to an estimated 73,633 thousand CBM by 2023, reflecting a CAGR of 4.4%.
Understanding Oil Storage: A Strategic Trade
Oil storage involves a complex interplay of factors, with vertically integrated companies strategically purchasing oil for immediate delivery and storing it until market conditions favor profitable sales. This storage can be temporary, as oil is often transported for refining processes. Crude oil and natural gas, the bedrock of petroleum resources, necessitate proper storage before being transported to refineries.
Market Dynamics: Forces Shaping Growth
The North America oil storage market’s growth is primarily fueled by a reduction in crude oil prices, prompting increased strategic storage activities. The need for mega refining hubs, stringent product containment measures, and the rise of import facilities further contribute to market expansion. However, challenges such as declining production, exploration activities, and escalating inventory costs act as growth inhibitors. On the flip side, the development of strategic petroleum reserves and a surge in oil demand present promising growth opportunities.
Segmentation Insights: Navigating Market Complexity
Product Segment:
Crude oil dominates the market, holding the largest share in 2016 and expected to maintain its lead.
Gasoline emerges as a significant growth segment, with a projected CAGR of 6.2% during the forecast period.
Material Segment:
Steel, carbon steel, and fiber-reinforced plastic (FRP) constitute the material choices in the market.
Product Design Segment:
Fixed roof tanks secured the largest market share in 2016, while floating roof tanks are expected to exhibit the highest growth rate.
Geographical Segment:
The U.S. holds the lion’s share, followed by Canada. Mexico is anticipated to become a dominant player in the market.
Key Market Players: Shaping the Landscape
The North America oil storage market is marked by the presence of key players steering its trajectory. Companies such as Royal Vopak N.V., Kinder Morgan, Inc., and Oiltanking GmbH (Marquard & Bahls) play pivotal roles. Other noteworthy players, including Valero Energy Corporation and Superior Tank Co., Inc., contribute to the market’s vibrancy and competitiveness.
Outlook and Conclusion: Towards a Sustainable Future
As the North America oil storage market continues to evolve, stakeholders must navigate through the complex interplay of market dynamics. The strategic storage of oil, driven by price fluctuations and geopolitical influences, remains a linchpin in ensuring a stable and resilient energy ecosystem. With promising growth opportunities on the horizon, the market is poised for sustained development, guided by the strategic initiatives of key players and the broader economic landscape.
