Saudi Arabia Transformer Oil Market Report and Forecast 2025-2034

Saudi Arabia Transformer Oil Market Outlook

The Saudi Arabia transformer oil market size was valued at USD 27.60 million in 2024. The market is further projected to grow at a CAGR of 6.2% between 2025 and 2034, reaching a value of USD 47.73 million by 2034.

Key Takeaways

• Increased demand for electricity, rising investments in the infrastructure supporting power transmission and distribution, and the need to maintain and replace ageing transformers are all expected to increase the Saudi Arabian transformer oil market share in the years to come.

• Innovations in transformer oil technology, particularly in mineral-based oils known for their excellent dielectric properties and fire-resistant characteristics, are important areas of focus in the market to ensure effective insulation, heat dissipation, and safety in power transformers.

• Shell International B.V., Chevron Corporation, Castrol Limited, Fuchs SE, and Gulf Chemical & industrial Oils Co are prominent players in the market.

The market is experiencing significant growth due to various factors such as rapid urbanisation, industrialisation, and the government's focus on expanding power infrastructure.

The increasing demand for high-quality transformer oils is driving the Saudi Arabian transformer oil market growth, as these oils are widely utilised in transformers to maintain cooling capacity and reduce high heat. The Saudi Ministry of Energy, Industry, and Mineral Resources (MEIM) established the Renewable Energy Development Office in 2017, intending to tender out 9.5 GW of primarily PV solar and wind energy by 2023. This initiative is expected to boost the demand for transformers, generators, reactors, and more transformer oils, as these components utilise transformer oils for cooling purposes.

Moreover, the growing focus on sustainability and environmental regulations is leading to the development of bio-based transformer oils. These oils are non-toxic and free from PCBs, providing a cleaner and more reliable alternative to traditional transformer oils. For instance, the Saudi Arabian government is focusing on power generation through Mutjadedah Program’s renewable energy targets, with a particular emphasis on solar energy. The country aims to reduce its dependency on oil revenues, diversify its energy mix, and develop its significant potential of private renewable energy.

The increasing development of power stations in Saudi Arabia to increase the power generation capacity is also accelerating the demand for transformer oils. As per industry reports, Saudi Power Procurement Company (SPPC) announced five new renewable energy projects with a combined capacity of 3,300 megawatts (MW) in September 2022. This includes three wind energy projects generating a total of 1,800 MW and two solar projects with a total capacity of 1,500 MW. Therefore, considering these factors, the transformer oil market in Saudi Arabia is expected to grow significantly in the coming years.

Market Segmentation

Saudi Arabia Transformer Oil Market Report and Forecast 2025-2034 offers a detailed analysis of the market based on the following segments:

Market Breakup by Type

• Mineral Oil
  • Paraffinic
  • Naphthenic

• Silicone-Based Oil

• Bio-Based Oil

Market Breakup by Application

• Transformer

• Switchgear

• Circuit Breaker

• Others

Market Breakup by End Use

• Power Generation

• Transmission

• Railways and Metros

• Others

Competitive Landscape

Market players are focusing on developing biodegradable transformer oils to align with environmental regulations and sustainability goals.

• Shell International B.V. 

• Chevron Corporation 

• Castrol Limited 

• Fuchs SE 

• Gulf Chemical & Industrial Oils Co. 

• Gulf Oil International Group 

• National Oil and Chemical Company (CHEMAOIL) 

• Ergon, Inc. 

• NYNAS AB 

• Others

Key Highlights of the Report