Coal oil is a colorless oil that is distilled from bituminous coal and used as a fuel for lamps. Chemically, coal oil is similar to kerosene. Coal oil is a shale oil. It is obtained from the distillation of cannel coal, mineral wax, and bituminous shale. Coal oil has higher boiling point compared to gasoline or petroleum ethers. Conventionally, coal oil is used in lighting applications. It can also be used for cooking and as a fuel for automobiles. Coal oil is derived from fossil fuels. The oil has low vapor pressure and hence, higher flash point compared to gasoline or LPG (liquefied petroleum gas). Coal oil has lower risk of explosion.
Demand for coal oil in automotive and aerospace industries is on the rise. Low vapor level of coal oil makes it suitable for jet engine applications, as it lowers the risk of exploding. Rise in the demand for coal oil for cooking applications is a key factor boosting the coal oil market. Recent advancements in the renewable energy sector are anticipated to augment the coal oil market in the next few years. According to the International Energy Agency, the global demand for natural gas is expected to increase by 1.6% per year over the next few years. This is anticipated to propel the coal oil market during the forecast period. Rise in the demand for fossil fuels in the chemical industry is also estimated to drive the coal oil market in the next few years. In the medical sector, coal oil is employed for treating disorders such as athlete’s foot, cold, and influenza. However, implementation of regulations related to coal gas exploration and production is projected to restrain the coal oil market in the near future.
Based on method of exploration, the global coal oil market can be segmented into hydraulic fracturing and horizontal drilling. In hydraulic fracturing (or fracking), a fluid is pumped under high pressure into the coal oil to open up fractures. Horizontal drilling is carried out at deep levels under the ground. Horizontal drilling reduces the number of visible vertical wells located above the ground. In terms of application, the coal oil market can be divided into lamp & lighting fuel, heating oil, jet engine fuel, chemical lubricant, medical & pharmaceutical, and household applications.
The global coal oil market expanded significantly in 2017. This trend is estimated to continue during the forecast period. In terms of demand, North America is considered a key region of the global coal oil market. Active gas exploration activities, especially by using unconventional methods, are driving the market in the region. Australia is a major country of the coal oil market in Asia Pacific. The coal oil market in the country has expanded rapidly over the last few years. The power generation sector in Australia has witnessed immense growth in the recent past. The market in China is also projected to expand significantly in the next few years.
Active gas exploration activities in Eastern Europe are anticipated to propel the coal oil market in the sub-region during the forecast period. Countries in Latin America such as Brazil and Mexico have initiated offshore development activities. This is estimated to boost the coal oil market in the region. Presence of oil reserves coupled with strong presence of oil companies in Middle East & Africa is likely to augment the market in the region during the forecast period.
Key players operating in the global coal oil market include Exxon Mobil Corporation, Chevron Corporation, BP plc, and Koch Industries, Inc.