Carbon Dioxide (CO₂) Market Size, Share, Trends, Industry Analysis Report
By Source (Hydrogen, Ethyl Alcohol, Ethylene Oxide, Substitute Natural Gas, Others), By Application, By Region – Market Forecast, 2025–2034
- Published Date:Sep-2025
- Pages: 126
- Format: PDF
- Report ID: PM1557
- Base Year: 2024
- Historical Data: 2020-2023
Overview
The global carbon dioxide (CO₂) market size was valued at USD 8.13 billion in 2024, growing at a CAGR of 4.37% from 2025 to 2034. Key factors driving demand for CO₂ include increasing production of polymers, expanding urbanization, and growing demand for carbonated drinks.
Key Insights
- The ethyl alcohol segment accounted for 31.46% of revenue share in 2024, due to the integration of ethanol plants with capture technologies.
- The oil & gas segment held 66.19% of revenue share in 2024, due to the growing need to maximize recovery from aging oil fields.
- North America accounted for 38.38% of the global carbon dioxide market share in 2024, owing to growing oil & gas exploration activities.
- The U.S. held 75.21% of the revenue share in the North America carbon dioxide (CO₂) landscape in 2024, due to its extensive pipeline infrastructure dedicated to transporting CO₂.
- The industry in Europe is projected to register a CAGR of 3.83% from 2025 to 2034, owing to a strong focus on sustainability and innovation in carbon utilization technologies.
Industry Dynamics
- Increasing production of polymers is fueling the demand for carbon dioxide (CO₂) as it incorporates CO₂ as a feedstock to create more sustainable and cost-effective plastics.
- Growing demand for carbonated drinks is driving the need for carbon dioxide (CO₂) as beverage manufacturers rely on CO₂ to create the signature fizz and bubbles in sodas, sparkling waters, and beers.
- Increasing demand for medical-grade CO₂ in surgeries, respiratory therapies, and other medical applications is expected to create a lucrative market opportunity during the forecast period.
- High energy consumption in capturing and storing CO₂ hinder the market growth.
AI Impact on Carbon Dioxide Market
- AI optimizes CO₂ capture processes by enhancing efficiency in monitoring and controlling emissions from industrial sources.
- AI enables smarter carbon utilization by accelerating the development of CO₂-based materials and chemicals through advanced simulations.
- AI-driven monitoring supports carbon accounting and compliance, boosting transparency in CCUS projects.
- Predictive maintenance powered by AI reduces downtime in CO₂ production and capture facilities, lowering costs and increasing market reliability.
Market Statistics
- 2024 Market Size: USD 8.13 Billion
- 2034 Projected Market Size: USD 12.50 Billion
- CAGR (2025–2034): 4.37%
- North America: Largest Market Share
Carbon Dioxide (CO₂) is a colorless, odorless gas composed of one carbon atom bonded to two oxygen atoms. It is a byproduct of respiration, combustion, and volcanic activity. CO₂ plays a crucial role in the carbon cycle, regulating Earth’s temperature through the greenhouse effect, but excessive emissions from human activities such as burning fossil fuels and deforestation contribute to global warming and climate change.
Emerging technological advancements are focusing on capturing and utilizing CO₂ as a resource, transforming a waste product into valuable commodities. This includes carbon capture, utilization, and storage (CCUS) technologies. Innovations are creating demand for CO₂, such as converting it into sustainable synthetic fuels (e-fuels), chemicals, plastics, and even solid carbonates for construction materials.
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The global demand for carbon dioxide (CO₂) is driven by the expanding urbanization. World Bank Group, in its report, stated that the urban population is expected to more than double by 2050. This is increasing the need for food production and refrigeration, where controlled atmosphere storage and modified packaging frequently use CO₂ to extend shelf life. Urbanization is further leading to higher electricity use for buildings, heating, and cooling. This surge in energy demand is increasing fossil fuel combustion, which releases large amounts of CO₂, creating the need for carbon capture and storage solutions to capture and transport CO₂ to the oil and gas sector for boosting production.
Drivers & Opportunities
Increasing Production of Polymer: Polymer production methods, especially those involving polyurethanes and polycarbonates, are fueling the demand for carbon dioxide as they directly incorporate CO₂ as a feedstock to create more sustainable and cost-effective plastics. Additionally, CO₂ acts as a blowing agent in the production of polymer foam, improving product properties and reducing material costs. The European plastic production increased to 57.2 million tonnes in 2021 from 53.9 million tonnes in 2020. Therefore, as polymer production expands to meet the rising demand from the automotive, consumer goods, electronics, healthcare, and food & beverages industries, the adoption of CO₂ increases.
Growing Demand for Carbonated Drinks: The rising demand for carbonated drinks is driving the need for carbon dioxide (CO₂) as beverage manufacturers rely on CO₂ to create the signature fizz and bubbles in sodas, sparkling waters, and beers. For instance, the British Soft Drinks Association, in its report, stated that carbonated drinks accounted for 38.6% of the UK soft drinks market share. Companies operating in carbonated drinks are injecting CO₂ into liquids under pressure to carbonate them. Additionally, the expansion of craft breweries and artisanal soda producers is further increasing CO₂ usage, since these businesses also depend on it for both carbonation and packaging. Hence, as global consumption of carbonated beverages grows, fueled by rising incomes, changing consumer preferences, and the popularity of soft drinks, the beverage industry must secure more CO₂ to meet production targets.
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Segmental Insights
Source Analysis
Based on source, the segmentation includes hydrogen, ethyl alcohol, ethylene oxide, substitute natural gas, and others. The ethyl alcohol segment accounted for 31.46% of revenue share in 2024, due to strong demand from food and beverage processing, particularly for carbonated drinks. The production of ethanol generated a substantial amount of CO₂ as a byproduct, and companies across the chemical and beverage industries utilized this source for commercial applications. Additionally, the growth of bioethanol production for fuel blending in the transportation sector created a reliable and large-scale supply of CO₂. The integration of ethanol plants with capture technologies further enhanced availability, strengthening the dominance of the segment.
The substitute natural gas segment is projected to register a CAGR of 4.76% from 2025 to 2034, owing to the rising global focus on sustainable energy and the shift toward low-emission fuels. Substitute natural gas production process generates concentrated CO₂ that industries efficiently capture and reuse. Increasing government support for decarbonization initiatives, coupled with advancements in gasification and methanation technologies, is projected to accelerate the segment growth. Furthermore, expanding investments in green hydrogen and power-to-gas projects is projected to fuel the growth of substitute natural gas as a high-potential source of CO₂.
Application Analysis
In terms of application, the segmentation includes food & beverages, oil & gas, medical, rubber, firefighting, and others. The oil & gas segment held 66.19% of revenue share in 2024, due to growing energy demand and the need to maximize recovery from aging oil fields. The oil & gas industry relied heavily on CO₂ for enhanced oil recovery (EOR) operations, where companies injected it into oil reservoirs to increase crude output. The segment also benefited from rising investments in exploration, production, and supply projects, particularly in North America and the Middle East, where CO₂ injection technologies helped improve efficiency and extend the lifecycle of oil reservoirs. According to the International Energy Agency, the Middle East is set to invest about USD 130 billion in oil and gas supply in 2025.
The food & beverages segment is expected to grow at a rapid pace during the forecast period, owing to rising consumer demand for carbonated drinks, packaged food, and frozen products. Manufacturers are using it for carbonation, chilling, freezing, and modified atmosphere packaging to maintain the freshness and extend the shelf life of the product. The surge in urbanization, rapid expansion of quick-service restaurants, and increasing preference for convenience foods are further strengthening the demand for carbon dioxide in the food & beverage industry. Moreover, the global beverage industry’s shift toward innovative product launches, including functional and low-calorie drinks, is propelling the requirement for reliable CO₂ supplies.
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Regional Analysis
The North America carbon dioxide (CO₂) market accounted for 38.38% of the global carbon dioxide (CO₂) share in 2024. This dominance is attributed to rising demand for packaged foods and growing oil & gas exploration activities. The U.S., in particular, is a major consumer of CO₂ for EOR, where it is injected into oil fields to increase extraction efficiency, especially in regions such as the Permian Basin. The growing emphasis on carbon capture, utilization, and storage (CCUS) technologies also propelled demand, as captured CO₂ is repurposed for industrial use rather than released into the atmosphere. Additionally, the food and beverage industry in the region relied heavily on CO₂ for carbonation, refrigeration, and modified atmosphere packaging. Increasing environmental regulations and incentives for emissions reduction further encouraged investment in CO₂ capture and utilization.
U.S. Carbon Dioxide (CO₂) Market Insights
The U.S. held 75.21% of the revenue share in the North America CO₂ landscape in 2024, due to its extensive pipeline infrastructure dedicated to transporting CO₂ for EOR. The food and beverage sector in the country remained a consistent consumer of CO₂ for carbonation and preservation. The expansion of carbon capture projects, supported by federal tax credits such as 45Q, created new supply sources and increased the availability of captured CO₂ for commercial use. Growing awareness of climate change and corporate sustainability goals also prompted industries to explore CO₂ utilization in chemical synthesis and renewable fuels, further diversifying demand.
Asia Pacific Carbon Dioxide (CO₂) Market Trends
The market in Asia Pacific is projected to hold a substantial revenue share by 2034 due to rapid industrialization, urbanization, and the expanding food and beverage industry. United Nations Human Settlements Programme, in its report, stated that the urban population in Asia is expected to grow by 50% by 2050. Countries such as India, Japan, and South Korea are increasing their use of CO₂ in industrial processes such as metal fabrication, chemical manufacturing, and water treatment. The region’s booming food & beverage industry, especially in urban centers, is driving demand for CO₂ in carbonation, freezing, and packaging. Additionally, growing environmental concerns are prompting governments and companies to explore carbon capture and utilization (CCU) technologies. Pilot projects and policy initiatives in countries such as Australia and Japan are laying the groundwork for future CO₂ utilization, particularly in synthetic fuels and building materials.
China Carbon Dioxide (CO₂) Market Overview
The demand for carbon dioxide (CO₂) in China is being driven by its massive industrial base, expanding food processing sector, and increasing focus on carbon neutrality goals. The food and beverage industry, particularly in urban areas, is contributing to steady demand for CO₂ in carbonation and cold chain logistics. Government support for green technologies and industrial decarbonization is accelerating the development of CCUS projects, especially in regions with high concentrations of power plants and heavy industry. These efforts are transforming CO₂ from a waste product into a valuable resource, thereby increasing its demand across multiple sectors in China.
Europe Carbon Dioxide (CO₂) Market Outlook
The industry in Europe is projected to register a CAGR of 3.83% from 2025 to 2034, owing to stringent environmental regulations, a strong focus on sustainability, and innovation in carbon utilization technologies. The European Union’s Green Deal and emissions reduction targets are driving investment in carbon capture and utilization (CCU), with CO₂ being used in applications such as renewable fuels, building materials, and chemical production. Circular economy principles and carbon pricing mechanisms are further incentivizing industries to adopt CO₂ reuse technologies, reinforcing long-term demand across the region.
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Key Players & Competitive Analysis
The global carbon dioxide market is highly competitive, featuring a mix of multinational industrial gas leaders and regional specialists. Key players such as Linde PLC, Air Liquide, Air Products and Chemicals, Inc., and Gulf Cryo dominate through extensive production networks and technological expertise. These companies leverage vertical integration and long-term supply agreements to maintain market share. Regional providers such as SICGIL Industrial Gases Ltd and BOSCO INDIA cater to localized demand, particularly in emerging economies. Innovators such as LanzaTech are introducing sustainable CO₂ capture and utilization technologies, adding a green dimension to the competitive landscape. Strategic partnerships, expansions in carbon capture, utilization, and storage (CCUS), and a growing focus on food-grade and beverage-grade CO₂ are shaping market dynamics. Competition is intensifying across production, purity standards, and sustainability practices, with rising environmental regulations and industrial demand.
A few major companies operating in the CO₂ market include Air Liquide; Air Products and Chemicals, Inc.; AIR WATER INC; Aker Solutions; Aramco; BOSCO INDIA; Gulf Cryo; Jinhong Gas Co., Ltd; LanzaTech; Linde PLC; UNIVERSAL AIR PRODUCTS PVT LTD; SABIC; and SICGIL Industrial Gases Ltd.
Key Companies
- Air Liquide
- Air Products and Chemicals, Inc.
- AIR WATER INC
- Aker Solutions
- Aramco
- BOSCO INDIA
- Gulf Cryo
- Jinhong Gas Co., Ltd
- LanzaTech
- Linde PLC
- SABIC
- SICGIL Industrial Gases Ltd
- UNIVERSAL AIR PRODUCTS PVT LTD
Carbon Dioxide (CO₂) Industry Developments
In March 2025, Aramco launched Saudi Arabia’s first CO₂ Direct Air Capture (DAC) test unit. It is capable of removing 12 tons of carbon dioxide per year from the atmosphere.
In July 2023, Technip Energies and LanzaTech Global, Inc. signed a joint collaboration agreement to transform waste carbon into ethylene, the most common building block in petrochemicals.
In May 2022, Air Water Inc. announced that it had developed the ReCO₂ STATION, which is a highly efficient system that recovers low-concentration CO₂ from sources such as the combustion exhaust gases from boilers and industrial furnaces.
Carbon Dioxide (CO₂) Market Segmentation
By Source Outlook (Revenue, USD Billion, Volume Kiloton, 2020–2034)
- Hydrogen
- Ethyl Alcohol
- Ethylene Oxide
- Substitute Natural Gas
- Others
By Application Outlook (Revenue, USD Billion, Volume Kiloton, 2020–2034)
- Food & Beverages
- Oil & Gas
- Medical
- Rubber
- Firefighting
- Others
By Regional Outlook (Revenue, USD Billion, Volume Kiloton, 2020–2034)
- North America
- U.S.
- Canada
- Europe
- Germany
- France
- UK
- Italy
- Spain
- Netherlands
- Russia
- Rest of Europe
- Asia Pacific
- China
- Japan
- India
- Malaysia
- South Korea
- Indonesia
- Australia
- Vietnam
- Rest of Asia Pacific
- Middle East & Africa
- Saudi Arabia
- UAE
- Israel
- South Africa
- Rest of Middle East & Africa
- Latin America
- Mexico
- Brazil
- Argentina
- Rest of Latin America
Carbon Dioxide (CO₂) Market Report Scope
|
Report Attributes |
Details |
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Market Size in 2024 |
USD 8.13 Billion |
|
Market Size in 2025 |
USD 8.50 Billion |
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Revenue Forecast by 2034 |
USD 12.50 Billion |
|
CAGR |
4.37% from 2025 to 2034 |
|
Base Year |
2024 |
|
Historical Data |
2020–2023 |
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Forecast Period |
2025–2034 |
|
Quantitative Units |
Revenue in USD Billion, Volume in Kiloton, and CAGR from 2025 to 2034 |
|
Report Coverage |
Revenue Forecast, Competitive Landscape, Growth Factors, and Industry Trends |
|
Segments Covered |
|
|
Regional Scope |
|
|
Competitive Landscape |
|
|
Report Format |
|
|
Customization |
Report customization as per your requirements with respect to countries, regions, and segmentation. |
FAQ's
The global carbon dioxide market size was valued at USD 10.67 billion in 2024 and is projected to grow to USD 17.77 billion by 2034
The global market is projected to register a CAGR of 5.2% during the forecast period.
In 2024, North America dominated the market due to its established oil & gas sector, strong food & beverage industry, and significant investments in CCUS technologies.
A few key players in the market are Air Liquide; Linde PLC; Air Products and Chemicals, Inc.; Praxair, Inc.; Taiyo Nippon Sanso Corporation; Messer Group GmbH; Gulf Cryo; SOL Group; Hunan Kaimeite Gases Co., Ltd.; Yingde Gases Group Company; Air Water Inc.; Matheson Tri-Gas; India Glycols Limited; SABIC; and Sicgil India Limited.
In 2024, the food & beverages segment accounted for the largest market share, driven by the growing demand for carbon dioxide in carbonation, chilling, and food preservation.
In 2024, the natural gas processing segment held the dominant market share owing to its high yield and efficiency in producing commercial-grade CO?.
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