Refrigeration Oil Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Type (Mineral Oil, Synthetic Oil), By Application (Air Conditioner, Refrigerator & Freezer, Automotive AC System, Others), By Region and Competition, 2020-2030F

Market Overview

Global Refrigeration Oil Market was valued at USD 1.25 Billion in 2024 and is expected to reach USD 1.51 Billion by 2030 with a CAGR of 3.35% during the forecast period. Lubrication of refrigeration compressors is of utmost importance for ensuring their optimal performance and efficiency. The type of refrigeration oil used plays a crucial role in determining the overall performance of the compressors. As refrigeration compressors operate under varying temperature conditions, the temperature inside the compressors tends to rise. Therefore, it becomes imperative to minimize and dissipate the heat generated by the compressors. To achieve this, refrigeration oils are used to disperse heat from various components of the compressor, such as compression chambers and valves, while also assisting in sealing. The demand for refrigeration oils that effectively dissipate heat from compressor components has been on the rise, thereby driving the growth of the global refrigeration oil market.

In refrigeration and freezer systems, air conditioners, and automotive air conditioning systems, the compression temperature can reach peak levels of up to 180ºC. The thermal and chemical stability of refrigeration oil plays a vital role in reducing the compression temperature, ensuring the proper functioning of air conditioners. Moreover, stringent environmental regulations have created new opportunities for the development of natural refrigeration oils, such as ammonia and carbon dioxide. This factor is expected to further fuel the growth of the global refrigeration oil market during the forecast period.

Refrigeration oils are gaining increasing importance and are being widely used in industrial heat pumps. Synthetic refrigeration oils are predominantly used in industrial compressors and heat pumps due to their superior efficiency compared to conventional oils. Furthermore, synthetic refrigeration oils are compatible with a wide range of refrigerants, including carbon dioxide and ammonia. Industrial refrigeration compressors, heat pumps, and low evaporators require the use of oils that effectively minimize heat generation, dissipate heat from the equipment, improve the lifespan of lubricant oils, and minimize shaft leakage. These factors have significantly contributed to the growing demand for refrigeration oil, driving the growth of the global market.

However, it is important to note that the oxidation capability of refrigeration oils results in the need for periodic drain and oil replacement, which can increase routine maintenance costs. On the other hand, the high viscosity index of refrigeration oil helps in minimizing fluid temperature, thereby reducing the deposition of wax content on compressors and associated parts. This ensures the smooth operation of the equipment and its components. Moreover, the low traction coefficient of refrigeration oil is vital for improving system efficiency and reducing power consumption. These desirable properties make refrigeration oil widely used in compressors, further driving the growth of the global market. It is worth mentioning that certain refrigeration oils may pose environmental concerns, necessitating periodic oil drain and replacement. The use of appropriate refrigeration oils is crucial for ensuring the efficient and reliable operation of refrigeration compressors and other related equipment. The global market for refrigeration oil is expected to witness significant growth due to the increasing demand for efficient heat dissipation, compatibility with diverse refrigerants, and the need for improved system efficiency in various industries.

Key Market Drivers

Growing Demand of Refrigeration Oil in Food & Beverage Industry

Refrigeration oil plays a pivotal role in the functionality of refrigeration systems. It ensures the smooth operation of compressors, which are the heart of refrigeration mechanisms, by providing necessary lubrication. This, in turn, leads to efficient cooling and ultimately, better preservation of food products. The food and beverage industry heavily relies on refrigeration systems to preserve the quality and extend the shelf life of products. From storing raw materials to preserving prepared foods, refrigeration is integral at every step of the food processing chain. Consequently, the demand for refrigeration oil is intrinsically linked to the operation of the food and beverage industry. The global food and beverage industry has been witnessing significant growth over the past few years. Factors such as rising population, urbanization, and changes in lifestyle have led to an increased demand for processed and packaged foods. These factors, coupled with stringent food safety regulations, have necessitated the expansion of cold storage facilities, and refrigerated transport, leading to an upswing in the demand for refrigeration oil.

In the United States, the Department of Agriculture (USDA) reported that food and beverage manufacturing shipments reached over USD 1.3 trillion in 2023, up from USD 1.1 trillion just five years earlier, signaling steady industrial growth. Similarly, data from India’s Ministry of Food Processing Industries (MoFPI) shows the sector contributed nearly 12% to the country’s manufacturing GDP in 2022–23, with significant government investments aimed at expanding cold chain and refrigerated storage infrastructure. Refrigeration systems are essential to maintain the safety and quality of perishable goods, and this has led to a sharp rise in cold storage construction. For instance, China’s National Bureau of Statistics highlighted that cold storage capacity exceeded 200 million cubic meters in 2022, with aggressive expansion plans underway as part of its national food security strategy. The European Union’s Eurostat data also reflects consistent growth in food production and export volumes, further increasing reliance on refrigerated transportation and storage. The expansion of the food and beverage industry, reinforced by national policy efforts, makes it clear that the demand for refrigeration oil will continue to grow in the years ahead.

Growing Demand of Refrigeration Oil in Healthcare Industry

Refrigeration oil plays a vital role in the smooth operation of refrigeration systems. It provides necessary lubrication for compressors, which are the heart of refrigeration mechanisms, ensuring efficient cooling. This is particularly important in the healthcare industry, where the effective preservation of critical items such as vaccines, medications, blood samples, and other biological materials heavily relies on refrigeration. The healthcare industry's reliance on refrigeration systems is profound and encompasses a wide range of applications. From storing temperature-sensitive drugs and vaccines to preserving organ transplants, refrigeration is integral to numerous healthcare processes. As a result, the demand for refrigeration oil is intrinsically tied to the functionality of the healthcare industry.

In India, the Ministry of Health and Family Welfare reported in 2023 that the national cold chain network had expanded to over 29,000 cold chain points, including over 900 walk-in coolers and 40,000 ice-lined refrigerators (ILRs) under the Universal Immunization Programme. This massive infrastructure growth, driven by both domestic health needs and vaccine exports, has sharply increased the deployment of refrigeration units that rely on synthetic and mineral-based refrigeration oils. In the European Union, data from Eurostat shows that pharmaceutical production has grown by over 20% between 2018 and 2023, with member states investing in centralized vaccine storage and distribution hubs. In the United States, the Department of Health and Human Services (HHS) allocated over USD 13 billion for vaccine distribution and cold chain logistics through Operation Warp Speed and other initiatives during and after the COVID-19 pandemic. As government spending on healthcare infrastructure and pharmaceutical cold chains continues to rise, so does the need for reliable, energy-efficient refrigeration systems. This has directly contributed to increased demand for refrigeration oil, especially synthetic types like polyolester (POE) and polyalkylene glycol (PAG), which are compatible with modern, low-global-warming-potential refrigerants. 

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Key Market Challenges

Problems Associated with Oil Disposal and Recycling

Used refrigeration oil, if not disposed of properly, can have severe environmental consequences. Improper handling and disposal methods often result in contamination of soil and water resources, posing a significant threat to both human health and biodiversity. The regulation of used lubricating oil disposal varies at the state and federal level, highlighting the importance of proper management to mitigate environmental impacts.

Moreover, older refrigerators and freezers not only contain used refrigeration oil but also ozone-depleting refrigerants and/or foam blowing agents. These substances add another layer of complexity to the disposal process and require specialized handling. If released into the atmosphere, these ozone-depleting substances contribute to global warming and the depletion of the ozone layer, exacerbating environmental concerns.

In the context of the circular economy, recycling used refrigeration oil presents unique challenges. While the circular economy aims to recover materials, reduce waste, and promote recycling, the actual process of recycling refrigeration oil is complex and resource intensive. It requires advanced technologies and specialized facilities to extract, purify, and re-refine the oil for reuse. Furthermore, the characteristics of used oil and oil production pose specific sustainability issues that need to be addressed.

To meet the growing demand for higher-quality lubricants, re-refiners have increased their used oil re-refining capacity. However, they face sustainability challenges related to oil composition, impurities, and the overall energy and resource requirements of the re-refining process. These considerations make the recycling of refrigeration oil a nuanced and multifaceted issue that requires careful attention to ensure environmental sustainability.

Key Market Trends

Transition to Low-GWP Refrigerants

The refrigeration industry has been gradually transitioning from hydrochlorofluorocarbons (HCFCs) to hydrofluorocarbon (HFC) refrigerants, but now it is shifting its focus towards low-GWP hydrofluoroolefin (HFO) refrigerants as part of a broader push for sustainability and reducing the environmental impact of refrigeration systems. Low-GWP refrigerants, such as CO2 (or refrigerant R-744), R-290 (propane), and others, are gaining popularity as more sustainable alternatives. These refrigerants have a lower potential for contributing to global warming compared to traditional refrigerants.

In the United States, the Environmental Protection Agency (EPA), under its American Innovation and Manufacturing (AIM) Act, has implemented a phasedown of hydrofluorocarbons (HFCs) by 85% over 15 years, beginning in 2022. This has accelerated the shift to low-GWP alternatives like R-1234yf, R-290 (propane), CO₂, and ammonia each requiring refrigeration oils that can handle the unique pressures, chemical properties, and thermal conditions of these new refrigerants. Similarly, the European Union, through its F-Gas Regulation, has set strict GWP thresholds and quotas, pushing industries to adopt eco-friendly refrigerants across sectors, including food, pharmaceuticals, and commercial buildings. The ongoing transition is not merely about the refrigerants themselves but also about the entire system compatibility, where refrigeration oils play a crucial role. As regulatory pressure intensifies and companies commit to sustainability goals, the demand for advanced, environmentally compatible refrigeration oils is expected to grow steadily, aligning with the global push toward climate-resilient cooling technologies.

Segmental Insights

Type Insights

Based on type, Synthetic Oil emerged as the fastest growing segment in the global market for Refrigeration Oil during the forecast period. This driven by a global shift toward high-efficiency and environmentally sustainable cooling systems. As industries transition to low-global-warming-potential (low-GWP) refrigerants in response to international agreements such as the Kigali Amendment and domestic regulations like the U.S. EPA’s AIM Act, synthetic oils particularly polyolester (POE) and polyalkylene glycol (PAG) are becoming essential. These oils offer superior thermal stability, chemical compatibility, and lubrication performance, making them suitable for advanced refrigerants such as R-1234yf, R-290 (propane), CO₂, and ammonia. Unlike mineral oils, which are typically used in older or low-cost systems, synthetic oils are specifically designed to perform under the high pressures and low temperatures associated with modern refrigeration and HVAC equipment. This makes them increasingly favored across critical sectors such as food processing, pharmaceuticals, healthcare, and automotive air conditioning, where uninterrupted refrigeration is vital. Additionally, regulatory pressure in major markets such as the European Union, the United States, and Japan is accelerating the shift toward synthetic lubricants due to their compliance with environmental and performance standards. As a result, the synthetic oil segment is not only expanding rapidly but is also expected to represent a growing share of overall market revenue in the coming years.

Application Insights

Based on application, Automotive AC System emerged as the dominating segment in the global market for Refrigeration Oil in 2024. This is primarily driven by the high global production of vehicles equipped with air conditioning systems, coupled with growing demand across both developed and emerging markets. As automotive air conditioning has become a standard feature in passenger and commercial vehicles, the need for high-performance refrigeration oils particularly synthetic oils such as polyalkylene glycol (PAG), which are compatible with refrigerants like R-134a and R-1234yf has grown substantially. Additionally, the automotive sector experiences more frequent maintenance cycles compared to stationary refrigeration systems, fueling consistent aftermarket demand for refrigerant oils. The rapid expansion of the electric vehicle (EV) segment has further accelerated this trend, as EVs rely heavily on efficient thermal management systems not only for cabin comfort but also for battery cooling. While other application areas such as refrigerators, freezers, and stationary air conditioning systems contribute significantly to the market, their replacement rates and oil consumption per unit are comparatively lower. As a result, the automotive AC segment is expected to maintain its dominant position in the coming years, supported by continued vehicle production, technological advancements, and the transition toward low-global-warming-potential refrigerants.

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Regional Insights

Based on Region, North America emerged as the dominating region in the Global Refrigeration Oil Market during the forecast period. This is driven by its mature industrial base, high penetration of refrigeration and air conditioning systems, and strong presence across key end-use sectors such as automotive, food processing, and healthcare. The region’s widespread adoption of HVAC systems particularly in the United States, where over 90% of households use air conditioning ensures consistent demand for refrigeration oils used in system maintenance and performance optimization. Additionally, North America has a well-established automotive industry, with millions of vehicles produced annually, each requiring high-performance refrigeration oils for air conditioning systems. The growing adoption of electric vehicles further contributes to this demand, as thermal management systems become more complex and reliant on advanced lubricants. Moreover, regulatory initiatives such as the EPA’s AIM Act, which mandates the phasedown of high-GWP refrigerants, are accelerating the shift toward synthetic oils compatible with next-generation refrigerants. Combined with a well-developed service infrastructure and high standards for energy efficiency and environmental compliance, these factors position North America as the dominant region in the global refrigeration oil market.

Recent Developments

• In June 2025, Renewable Lubricants, Inc. launched its Bio-SynXtra Food Grade Refrigeration/Compressor Oils, a new line of bio-based lubricants specifically formulated for refrigeration and compressor systems used in food processing. These oils are designed to enhance lubricity, seal conditioning, and anti-wear performance while offering strong oxidation and thermal stability, a low pour point, and a high flash point to minimize fire risk. They also provide rust protection, anti-foam performance, and demulsibility. The product line is available in multiple ISO viscosity grades, including 15 through 200, catering to a wide range of industrial applications.
• In May 2025, Smardt unveiled its new ECO AeroMod modular air-cooled chiller platform, representing a strategic move beyond its traditional oil-free centrifugal product line. This launch introduces a high-efficiency, modular solution designed to deliver scalable performance and flexible integration across diverse commercial and industrial building applications, reinforcing Smardt’s commitment to innovation in advanced HVAC systems.
• In November 2024, specialty chemicals company Lanxess introduced its Everest ESR 220, a synthetic ester lubricant formulated for HVACR systems using R-1234ze refrigerant. Developed in partnership with a major original equipment manufacturer (OEM) and supported by funding from the U.S. Department of Energy (DOE), Everest ESR 220 is a patented formulation that has been approved and adopted by several leading global manufacturers for commercial use.
• In October 2024, refrigeration lubricant manufacturer Lubrizol expanded its distribution agreement with UK-based Oil Store to cover Europe, the Middle East, and North Africa (EMENA). This strategic move broadens the regional availability of Lubrizol’s extensive portfolio of fluid engineering solutions, including its well-known brands such as CPI industrial refrigeration products, Paratherm heat transfer fluids, and Emkarate RL, Icematic, and Solest refrigeration compressor lubricants.

Key Market Players

• Eneos Holdings Inc.
• Idemitsu Kosan Co. Ltd
• EXXONMOBIL CORPORATION
• Royal Dutch Shell Plc
• Total Energies SE
• Chevron Corporation
• Johnson Controls International plc
• Cosmo Oil Lubricants Co., Ltd.
• National Refrigerants, Inc.
• BASF SE

In this report, the Global Refrigeration Oil Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Refrigeration Oil Market, By Type:

o   Mineral Oil

o   Synthetic Oil

• Refrigeration Oil Market, By Application:

o   Air Conditioner

o   Refrigerator & Freezer

o   Automotive AC System

o   Others

• Refrigeration Oil Market, By Region:

o   North America

§  United States

§  Canada

§  Mexico

o   Europe

§  France

§  United Kingdom

§  Italy

§  Germany

§  Spain

o   Asia-Pacific

§  China

§  India

§  Japan

§  Australia

§  South Korea

o   South America

§  Brazil

§  Argentina

§  Colombia

o   Middle East & Africa

§  South Africa

§  Saudi Arabia

§  UAE

§  Egypt

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Refrigeration Oil Market.

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Company Information

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