The global petrochemical sector is witnessing great development by providing advanced solutions for trade and logistics, as global supply chains are experiencing severe disruptions today considering the uncertain expectations of oil prices, fluctuations in global production capacity, pricing policies, and uncertainty in the trade movement, which are factors that have accelerated the deflation of the economy.
The volatility of the markets has led to more pressures on all sectors, including the petrochemical sector, which is a mainstay of economies around the world, as petrochemicals are a vital part of our daily life, and an important component of the circular economy. Almost everything is made from petrochemicals, from automotive parts and electronics to the food, beverage, and medical industries. The importance of petrochemicals is also reflected in the labour market, which is witnessing an improvement with the increase in demand for these industries, which will continue in the near future, to certainly contribute to achieving development and progress in various fields.
The petrochemical sector is witnessing an unprecedented importance at the global and regional level, and the GCC market is a major center for the production and export of chemicals, as it produces goods worth more than $108 billion. The sector has tremendous potential, and we hope to enhance our contribution to its multi-fold growth in the region.
The forecasts for the total demand for petrochemicals indicate that the overall outlook stays positive, despite the instability in the sector on many sides, as the petrochemical sector is expected to grow to $1 trillion by 2030, which increases the new demand for oil and gas in the market. The demand for petrochemical products will come mainly from the building and construction, pharmaceutical, automotive, and electronics sectors.
On the local level, the petrochemical industry in Oman is playing a key role in supporting the country's economic diversification efforts and increasing exports by maximizing the added value of oil and gas products. The government recognizes the importance of this industry in broadening the national economy's base and making more efficient use of the country's natural resources. With the expansion of downstream facilities, such as Liwa Plastics, Duqm Refinery and Salalah OQ LPG, there are opportunities for the manufacturing of a wide range of petrochemical products that have applications in several industries such as construction, packaging, automotive, and pharmaceuticals.
In particular, the localisation of the plastics industry is a significant trend with support of Liwa Plastics, and the Duqm Refinery project, with its processing capacity of 230,000 barrels per day is expected to drive significant growth in the sector. The project is the largest in the field of refineries and petrochemicals and will produce diesel and jet fuel, in addition to naphtha and liquefied petroleum gas.
The petrochemical downstream industry in Oman offers several opportunities for growth and expansion, making it a promising sector for investment in the manufacturing of various petrochemical products, including polyethylene, polypropylene, PVC, and specialty chemicals like solvents, detergents, and adhesives, which are utilised in different sectors such as construction, packaging, automotive, and pharmaceuticals With the potential to produce active pharmaceutical ingredients (APIs) for medicine.
In conclusion, the petrochemical industry in Oman is one of the most supportive sectors for the expansion of manufacturing industries and economic diversification. The country's downstream capacity is expanding with the construction of new facilities and there are opportunities for the manufacturing of various petrochemical products. Oman recognises the potential of this industry and is making efforts to utilize its natural resources more efficiently to broaden the base of the national economy.
Dr Yousuf Hamed al Balushi
yousufh@omaninvestgateway.com
www.omaninvestgateway.com
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