Very Low Sulphur Fuel Oil Market Research Report Information by Source (Refinery and Hydrocracker), by Viscosity Grade (IFO 180, IFO 380, MGO), by Sulphur Content (0.5% Sulfur and 0.1% Sulfur), by Application (Main Engine, Auxiliary Engine, Boiler), by End-User (Shipping, Power Generation, Industrial Boilers, Others) and Region (North America, Europe, Asia-Pacific, South America, Middle East & Africa) - Forecast till 2035

Very Low Sulphur Fuel Oil Market Overview

The Very Low Sulphur Fuel Oil Market was valued at USD 114.82 Billion in 2024. The Very Low Sulphur Fuel Oil Market industry is projected to grow from USD 121.57 Billion in 2025 to USD 260.85 Billion by 2035, exhibiting a compound annual growth rate (CAGR) of 7.20% during the forecast period (2025-2035).

The increasing marine fuel standards and rising demand from the shipping industry and technological advancements in fuel processing are driving the growth of the Very Low Sulphur Fuel Oil Market.

As per the Analyst at MRFR, the global maritime industry has undergone a paradigm shift in its approach to fuel standards, driven by the imperative to reduce its environmental footprint and adhere to evolving regulatory frameworks. The introduction of stringent marine fuel standards, particularly the International Maritime Organization's (IMO) 2020 regulation, has been a seminal development, positioning Very Low Sulphur Fuel Oil (VLSFO) as a critical compliance option. 

The IMO 2020 regulation mandated a substantial reduction in the maximum allowable Sulphur content in marine fuels used outside Emission Control Areas (ECAs) from 3.5% to 0.5%. This landmark directive has catalyzed the adoption of VLSFO globally, as it offers a practical and accessible solution to meet compliance requirements without necessitating significant modifications to existing vessel engines. The shipping industry has long been a major contributor to global Sulphur oxide (SOx) emissions, which have detrimental effects on human health and the environment. SOx emissions contribute to respiratory illnesses and the formation of acid rain, which damages ecosystems and infrastructure. The shift to VLSFO has helped reduce these emissions significantly, supporting international efforts to combat air pollution and climate change.

 FIGURE 1: VERY LOW SULPHUR FUEL OIL MARKET VALUE (2019-2035) USD BILLION

 Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review

Very Low Sulphur Fuel Oil Market Opportunity

GROWTH IN RENEWABLE FUEL INTEGRATION

The global energy landscape is undergoing a transformative shift toward sustainability, driven by the increasing emphasis on renewable and alternative fuels. The maritime industry, a significant consumer of Very Low Sulphur Fuel Oil (VLSFO), is actively exploring opportunities to integrate renewable fuels as part of its commitment to reducing carbon emissions and complying with evolving environmental regulations. This growing focus on renewable fuel integration represents a substantial opportunity for the VLSFO market, with implications for product innovation, market growth, and environmental impact. 

Innovations in fuel chemistry and blending techniques have facilitated the seamless integration of renewable components with VLSFO. Advanced refining processes allow for the incorporation of bio-based oils, waste-derived fuels, and synthetic hydrocarbons without compromising fuel stability, viscosity, or combustion efficiency. This technical capability broadens the appeal of renewable-VLSFO blends for diverse maritime applications. International associations/regulatory bodies such as the International Maritime Organization (IMO) are implementing stringent regulations to lower greenhouse gas (GHG) emissions from ships. Policies like the IMO 2020 sulphur cap and the upcoming IMO 2050 decarbonization goals are compelling ship operators to adopt fuels with reduced environmental impact. This regulatory push creates an opportunity to blend renewable fuels, such as biofuels, with VLSFO to achieve compliance while leveraging existing fuel infrastructure.

Very Low Sulphur Fuel Oil Market Segment Insights

Very Low Sulphur Fuel Oil System by Source Insights

Based on Source, this segment includes Refinery and Hydrocracker. The Refinery segment dominated the global market in 2024, while the Hydrocracker segment is projected to be the fastest–growing segment during the forecast period. The refinery segment is another essential source of VLSFO production. Refineries utilize a combination of distillation and desulfurization processes to produce a wide range of fuels, including VLSFO. The ability of a refinery to produce high-quality, compliant VLSFO depends largely on its refining configuration, capacity, and the quality of crude oil feedstocks available. 

Refining crude oil involves several key steps, including distillation, cracking, and desulfurization. The distillation process separates the crude oil into various fractions based on boiling points, with heavier fractions used to create fuel oil. The cracking process further breaks down heavier hydrocarbons into lighter, more valuable products, including VLSFO. Desulfurization processes such as hydrodesulfurization (HDS) remove sulfur from the fuel fractions, making them suitable for marine use.

FIGURE 2: VERY LOW SULPHUR FUEL OIL MARKET SHARE BY SOURCE 2024 AND 2035 (USD BILLION)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Very Low Sulphur Fuel Oil System by Viscosity Grade Insights

Based on Viscosity Grade, this segment includes IFO 180, IFO 380, MGO. The IFO 180 segment dominated the global market in 2024, while the IFO 380 segment is projected to be the fastest–growing segment during the forecast period. IFO 180 refers to a type of intermediate fuel oil with a maximum viscosity of 180 centistokes (cSt) at 50°C. It is a blended product comprising residual and distillate fuels, offering a balance between efficiency and cost. Before the introduction of IMO 2020 regulations, IFO 180 was widely used in medium-speed and auxiliary engines, particularly in smaller vessels or ships operating in areas with stricter emissions regulations.

Very Low Sulphur Fuel Oil System by Sulphur Content Insights

Based on Sulphur Content, this segment includes 0.5% Sulfur and 0.1% Sulfur. The 0.5% Sulfur segment dominated the global market in 2024, while the 0.1% Sulfur segment is projected to be the fastest–growing segment during the forecast period. The 0.5% sulfur content in marine fuel refers to the sulfur limit introduced by the IMO 2020 regulations, which came into effect on January 1, 2020. 

This regulation mandates that all ships must use fuel with no more than 0.5% sulfur by weight, as opposed to the previous cap of 3.5% sulfur content. The goal of this regulation is to reduce sulfur oxide emissions, which are major contributors to air pollution, acid rain, and health problems.

Very Low Sulphur Fuel Oil System by Application Insights

Based on Application, this segment includes Main Engine, Auxiliary Engine, Boiler. The Main Engine segment dominated the global market in 2024, while it is projected to be the fastest–growing segment during the forecast period. The main engine is the primary power source for a vessel, responsible for propelling the ship through the water. It is typically the largest and most powerful engine onboard, designed to drive the ship’s propeller and, in some cases, provide electrical power to the ship’s systems. 

In the context of the Global Very Low Sulphur Fuel Oil (VLSFO) Market, the compatibility of the main engine with low-sulfur fuels is paramount due to the IMO 2020 sulfur cap regulations, which mandate that ships must use fuels with a sulfur content of no more than 0.5% or install exhaust gas cleaning systems (scrubbers).

Very Low Sulphur Fuel Oil System by End-User Insights

Based on End-User, this segment includes Shipping, Power Generation, Industrial Boilers, Others. The Shipping segment dominated the global market in 2024, while it is projected to be the fastest–growing segment during the forecast period. Shipping is essential for global trade and transportation, moving over 80% of the world’s commodities across oceans. Traditionally, vessels have used high-sulfur fuel oil (HSFO), a low-cost fuel derived from residual oil left over after refining. 

However, under the IMO 2020 regulations, sulfur content in marine fuels had to be drastically reduced from 3.5% to 0.5%. VLSFO, with sulfur content within this new limit, has emerged as a vital fuel solution for the industry. Shipping vessels, including container ships, tankers, bulk carriers, and cruise ships, now rely heavily on VLSFO for their main engines, auxiliary engines, and boilers. The adoption of VLSFO allows shipping companies to avoid the additional costs of installing exhaust gas cleaning systems (scrubbers) or transitioning to alternative fuels like liquefied natural gas (LNG), which can be more expensive and logistically challenging to implement.

Very Low Sulphur Fuel Oil System Regional Insights

Based on the Region, the global Very Low Sulphur Fuel Oil is segmented into North America, Europe, Asia-Pacific, South America and Middle East & Africa. The Asia-Pacific dominated the global market in 2024, while it is projected to be the fastest–growing segment during the forecast period. Major demand factors driving the Asia-Pacific market are the increasing marine fuel standards and rising demand from the shipping industry and technological advancements in fuel processing. 

The region is home to some of the world's largest economies, such as China and India, which are experiencing rapid industrialization and urbanization. This has led to an increase in demand for energy, including very low Sulphur fuel oil. Additionally, government regulations in the region are becoming increasingly stringent, which is driving the adoption of cleaner fuels such as Very Low Sulphur Fuel Oil.

FIGURE 3: VERY LOW SULPHUR FUEL OIL MARKET VALUE BY REGION 2024 AND 2035 (USD BILLION)

Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review

Further, the countries considered in the scope of the Application Tracking System Market are the US, Canada, Mexico, Germany, the UK, France, Italy, Spain, Italy, Japan, China, India, Australia, Brazil, Colombia, South Africa, GCC Countries and others.

Global Very Low Sulphur Fuel Oil Key Market Players & Competitive Insights

Many global, regional, and local vendors characterize the Very Low Sulphur Fuel Oil Market. The market is highly competitive, with all the players competing to gain market share. Intense competition, rapid advances in technology, frequent changes in government policies, and environmental regulations are key factors that confront market growth. The vendors compete based on cost, product quality, reliability, and government regulations. Vendors must provide cost-efficient, high-quality products to survive and succeed in an intensely competitive market.

The major competitors in the market are Shell, ExxonMobil, Chevron, TotalEnergies, China Petrochemical Corporation / Sinopec Group are among others. The Very Low Sulphur Fuel Oil Market is a consolidated market due to increasing competition, acquisitions, mergers and other strategic market developments and decisions to improve operational effectiveness.

Key Companies in the Very Low Sulphur Fuel Oil Market include

• Shell


• ExxonMobil


• Chevron


• TotalEnergies


• China Petrochemical Corporation / Sinopec Group

Very Low Sulphur Fuel Oil Market Segmentation

Very Low Sulphur Fuel Oil by Source Outlook

• Refinery


• Hydrocracker

Very Low Sulphur Fuel Oil by Viscosity Grade Outlook

• IFO 180


• IFO 380


• MGO

Very Low Sulphur Fuel Oil by Sulphur Content Outlook

• 5% Sulfur


• 1% Sulfur

Very Low Sulphur Fuel Oil by Application Outlook

• Main Engine


• Auxiliary Engine


• Boiler

Very Low Sulphur Fuel Oil by End-User Outlook

• Shipping


• Power Generation


• Industrial Boilers


• Others

Very Low Sulphur Fuel Oil Regional Outlook

• North America
  
  
  
  • US
  
  
  • Canada
  
  
  • Mexico
  
  
  
  


• Europe
  
  
  
  • Germany
  
  
  • UK
  
  
  • France
  
  
  • Italy
  
  
  • Spain
  
  
  • Rest of Europe
  
  
  
  


• Asia-Pacific
  
  
  
  • Japan
  
  
  • China
  
  
  • India
  
  
  • Australia
  
  
  • Rest of Asia-Pacific
  
  
  
  


• South America
  
  
  
  • Brazil
  
  
  • Colombia
  
  
  • Rest of South America
  
  
  
  


• Middle East & Africa
  
  
  
  • South Africa
  
  
  • GCC Countries
  
  
  • Rest of Middle East & Africa
  
  
  
  

Report Attribute/Metric	Details
Market Size 2024	USD 114.82 Billion
Market Size 2025	USD 121.57 Billion
Market Size 2035	USD 260.85 Billion
Compound Annual Growth Rate (CAGR)	7.20% (2025-2035)
Base Year	2024
Forecast Period	2025-2035
Historical Data	2019-2023
Forecast Units	Value, Volume (USD Billion, K Tons)
Report Coverage	Revenue Forecast, Competitive Landscape, Growth Factors, and Trends
Segments Covered	By Source, By Viscosity Grade, By Sulphur Content, By Application, By End-User
Geographies Covered	North America, Europe, Asia Pacific, South America, Middle East & Africa
Countries Covered	The US, Canada, Mexico, Germany, the UK, France, Italy, Spain, Italy, Japan, China, India, Australia, Brazil, Colombia, South Africa, GCC Countries
Key Companies Profiled	Shell, ExxonMobil, Chevron, TotalEnergies, China Petrochemical Corporation / Sinopec Group
Key Market Opportunities	·         Growth in Renewable Fuel Integration ·         Expansion of Alternative Fuel Infrastructure
Key Market Dynamics	·         Increasing Marine Fuel Standards ·         Rising Demand from the Shipping Industry ·         Technological Advancements in Fuel Processing