As the coronavirus outbreak has been declared a global pandemic, global demand for energy has fallen sharply. Consequently, a glut in oil and gas production is maxing out storage capacities of major fuel consumer countries. Stay at home orders have resulted in reduction in fuel usage in personal and industrial settings. This trend is likely to be profitable for fuel storage container manufacturers in the short term.
The global fuel storage container market is projected to reach a valuation of US$ 9 Bn through the forecast period (2020-2030). As a number of countries have gradually begun easing restrictions on travel and business, the oversupply of oil and gas has started to stabilize. According to estimates, the pandemic is likely to be under control during the first half of 2021. Following this, oil prices are likely to recover and the storage crisis is likely to stop as economies recover and demand returns to pre-pandemic levels. Demand for fuel storage containers will remain steady in the foreseeable future.
“Fuel delivery and storage can often be a short-term process, as crude oil and gas is immediately transported for refining. Further, oil storage infrastructure is essential to safeguard profits from near-term supply fluctuations. Also, the rise in oil production has pushed suppliers to invest in increasing their inventories to manage large quantities of fuel. These trends will remain key to sustained growth in the industry post the coronavirus outbreak,” says the FACT.MR analyst.
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Fuel Storage Container Market- Critical Takeaways
- Fixed roof fuel storage tanks are anticipated to stay in the lead, while floating roof variants will display a strong growth rate.
- Driven by DIY trends, and customization efforts by manufacturers, portable fuel storage tanks are anticipated to gain substantial traction.
- Fuel storage tanks of 55-gallon capacity are expected to remain a major contributor to revenue.
- North America is one of the leading and fastest growing consumers of fuel storage containers. Middle East and Africa will generate key remunerative opportunities.
Fuel Storage Container Market- Drivers
- Steady production of oil and gas on a global scale remains a key driver for the adoption of fuel storage containers.
- Decline in crude oil prices is increasing fuel sales and boosting the demand for storage containers.
- Strict regulations associated with fuel containment, and government investments in strategic petroleum reserves will impede market growth.
Fuel Storage Container Market- Restraints
- Declining fuel exploration and production activities are anticipated to restrict market growth.
- Growing costs associated with fuel storage inventory expansions is also likely to hinder the market.
COVID-19 Impact on Fuel Storage Container Market
According to estimates, around 80% of global land-based fuel storage infrastructure has been filled following the coronavirus outbreak. The pandemic has forced airlines to cut flights, reduced on road transport, and international trade which has sharply shrunk the demand for fuel, creating a potential shortage of storage spaces. This situation is expected to continue escalating unless refineries drastically reduce their output.
On the other hand, this has also generated major remunerative opportunities for fuel storage container manufacturers. With oil prices expected to stay down in the near future, the demand for containers will be sustained in the foreseeable future, even after the pandemic is brought under control.
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Players in the fragmented fuel storage container market are investing in the expansion of production capacity, through the setup of new facilities or the expansion of current production infrastructure. For instance, Prostar Capital has entered into a strategic partnership with Vitol Inc to expand its marine fuel storage facilities. Similarly, FortisBC Holdings Inc., is pushing for a LNG storage expansion contract with the government of Canada.
Royal Vopak N.V., ZLC Composites, Marquard & Bahls, Belco Manufacturing Company, Tuffa Tank, Containment Solutions, Snyder Industries, Sunoco Logistics, Zeimann Holvrieka GmbH, Oiltanking GmbH, Red Ewald Inc., L.F. Manufacturing, Columbian Steel Tank, Synalloy Corporation, and Poly Processing are some of the leading fuel storage container manufacturers.
About the Study
The report provides a detailed forecast of the fuel storage container market. Global, regional and national-level analysis of recent trends affecting the fuel storage container market is covered in this FACT.MR report. The study provides insights according to product type (portable fuel containers, 275 Gal. IBC, and 55 Gal. Fuel Storage Drums) in seven regions (North America, Latin America, Western Europe, Eastern Europe, Asia Pacific Excluding Japan, Japan, and MEA).