Middle East Methanol Market Size, Share & Trends Analysis Report By Application (Formaldehyde, Gasoline, Acetic Acid, MTBE, Dimethyl Ether, MTO/MTP, Biodiesel, Other Applications), By Country, And Segment Forecasts, 2025 - 2033

Middle East Methanol Market Summary

The Middle East methanol market size was estimated at USD 1.1 billion in 2024 and is projected to reach USD 1.52 billion by 2033, growing at a CAGR of 3.8% from 2025 to 2033. Their critical role in formaldehyde production increasingly supports the market demand for Middle East methanol, as methanol is extensively used in industrial applications.

Methanol is often oxidized via catalytic processes to produce formaldehyde, a vital intermediate in manufacturing resins, plastics, adhesives, coatings, and wood products. The process is particularly important in the wood preservation industry, where formaldehyde enhances durability by strengthening the bonds between lignin and cellulose, improving resistance and structural integrity. Its low viscosity enables deep penetration into wood fibers, making it effective for high-performance engineered wood and construction materials.

In addition, formaldehyde’s reactivity supports the synthesis of diverse derivatives such as phenol-formaldehyde and urea-formaldehyde resins, which are widely used in furniture, automotive, and building sectors. The Middle East benefits from abundant low-cost methanol feedstocks, strong downstream resin demand, and proximity to construction and manufacturing hubs, all of which reinforce formaldehyde production as a major growth driver in the regional methanol market.

In the Middle East, methyl tert-butyl ether (MTBE) production is a significant driver of methanol demand, as methanol reacts with isobutene in the liquid phase to form MTBE, an important high-octane gasoline additive. The process benefits from methanol’s high reactivity, the region’s abundant isobutene feedstock, and the strong demand for cleaner-burning fuels to meet stringent fuel quality standards. These factors position MTBE synthesis, enabled by efficient methanol conversion, as a key application supporting methanol market growth in the Middle East.

The methanol market in the Middle East for biodiesel applications is growing, driven by its strong methanol production capabilities and growing global demand for sustainable fuels. Methanol plays a crucial role in biodiesel production through the transesterification process, where it reacts with vegetable oils or animal fats to produce fatty acid methyl esters (FAME), the primary component of biodiesel. The region benefits from abundant and cost-competitive methanol supply, thanks to low-cost natural gas feedstock in key producing countries such as Qatar, Iran, and Saudi Arabia.

In addition, the Middle East’s strategic location positions it as an ideal hub for exporting methanol to biodiesel markets in the Middle East, Africa, and South Asia, where blending mandates and sustainability policies drive demand. Domestically, the region sees emerging biodiesel initiatives aligned with waste oil recycling, energy diversification, and sustainability goals, creating new avenues for methanol consumption.

Renewable methanol production in the Middle East is gaining strategic importance as the region seeks to diversify its energy portfolio and reduce greenhouse gas emissions in line with national net-zero targets. Renewable methanol can be produced through two primary pathways: bio-methanol, derived from sustainable biomass feedstocks such as agricultural residues, municipal solid waste (MSW), sewage sludge, biogas, and forestry by-products; and green e-methanol, synthesized using CO₂ captured from renewable sources (including bioenergy with carbon capture and storage [BECCS] and direct air capture [DAC]) combined with green hydrogen produced from renewable electricity.

However, in the Middle East methanol industry, rising environmental and health concerns act as a restraint, as conventional methanol production from fossil fuels generates CO₂ emissions, air and water pollution, and ecosystem damage. This is driving a gradual shift toward green methanol alternatives to mitigate sustainability challenges.

Middle East Methanol Market Report Segmentation

This report forecasts revenue & volume growth at regional and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2033. For this study, Grand View Research has segmented the Middle East methanol market report based on application, and region:

• Application Outlook (Volume, Million Tons; Revenue, USD Billion, 2018 - 2033)
• Formaldehyde
• Gasoline
• Acetic Acid
• MTBE
• Dimethyl Ether
• MTO/MTP
• Biodiesel
• Other Applications
• Country Outlook (Volume, Million Tons; Revenue, USD Billion, 2018 - 2033)
• Middle East
• Oman
• Kuwait
• Saudi Arabia
• UAE
• Qatar
• Bahrain
• Israel

Please note The report will be delivered in 4-8 business days upon order notification. Show more