# Hydrogen: Overview

The invisible gas inside your fuel, fertiliser and plastics

Source page: https://www.materialinsights.org/chemicals/hydrogen/overview/

What this tab covers What the chemical is, how big its market is, what it is used for (with shares, volumes, why it wins and what could replace it), and its chain from raw material to end user. Ends with three things to remember.

Hydrogen is a colourless gas made mostly by reforming natural gas or gasifying coal. The world used almost 100 Mt in 2024, up 2% on 2023 (IEA Global Hydrogen Review 2025). Nearly all of it goes to oil refining, ammonia, methanol and gas-based steel, and most is made and used on the same site. Low-emissions hydrogen is under 1% of output. For a climate fund it matters twice: grey hydrogen emits roughly 900 Mt of CO2 a year, and clean hydrogen is the route to low-carbon fertiliser, steel and shipping fuel.
 Volume almost 100 Mt a year (2024) Market value about $150-200 billion a year (indicative, basis: 100 Mt x $1.5-2/kg grey production cost; most is captive and never priced) Growth 2% in 2024; low-emissions output on track for about 1 Mt in 2025 and 4.2 Mt a year by 2030 from projects operating or at FID IEA Global Hydrogen Review 2025 (executive summary, demand and production pages)

#### Key uses

| Use | Share | Annual volume | Why this commodity | Alternatives |
|---|---|---|---|---|
| **Oil refining (hydrotreating, hydrocracking, desulphurisation)** | 43% | about 43 Mtbasis | Refiners need hydrogen to strip sulphur from diesel and petrol to meet fuel standards and to crack heavy oil into lighter products. Part comes as a by-product of the refinery's own naphtha reformer; the rest from on-site steam reformers or merchant suppliers next door. IEA Global Hydrogen Review 2023-2024 sector split (indicative, basis: refining about 43% of demand) | Lower-sulphur crude Electrification of transport, which cuts fuel demand |
| **Ammonia (fertilisers and chemicals)** | 33% | about 34 Mtbasis | Ammonia is nitrogen from air plus hydrogen. There is no other industrial route to fixed nitrogen at scale, so every tonne of urea and nitrate fertiliser starts as hydrogen. IFA via DTN (Dec 2025); stoichiometry | Biological nitrogen fixation by legumes Manure |
| **Methanol** | 16% | about 16 Mtbasis | Methanol is made from syngas (hydrogen plus carbon monoxide). China makes most of its methanol from coal, which also feeds coal-to-olefins plants. IEA Global Hydrogen Review 2023-2024 (indicative) | Biomass gasification CO2 plus green hydrogen (e-methanol) |
| **Direct reduced iron (gas-based DRI steel)** | 5% | about 5 Mtbasis | Gas-based DRI plants in India, Iran and the Middle East reduce iron ore with a hydrogen-rich syngas. Replacing that syngas with pure hydrogen is the main route to near-zero steel. IEA Global Hydrogen Review 2023-2024 (indicative) | Blast furnace with coke Scrap-based electric arc furnace |
| **New uses: biofuel upgrading, mobility, power, synthetic fuels** | 1% | under 1 Mtbasis | Mostly hydrogen for hydrotreated vegetable oil (HVO) and sustainable aviation fuel. Fuel cell trucks are concentrated in China, which holds almost 95% of the world's fuel cell commercial vehicles. IEA Global Hydrogen Review 2025 | Battery electric vehicles Biofuels without hydrotreating |

 Total from IEA GHR 2025 (almost 100 Mt, 2024). Sector shares are indicative, from IEA GHR 2023-2024 sector splits; the ammonia row is cross-checked by stoichiometry. Rounded shares sum to about 98%; the rest is small industrial uses (glass, electronics, food hydrogenation).

#### From raw material to user

1. **Gas or coal supply** Fossil hydrogen used about 290 bcm of natural gas and 90 Mtce of coal in 2024 (IEA GHR 2025).
2. **Reforming or gasification** Steam methane reforming turns methane and steam into syngas; coal gasifiers do the same with coal and oxygen. About two-thirds of hydrogen comes from gas (indicative, basis: IEA).
3. **Water-gas shift and purification** Carbon monoxide is shifted to CO2 and more hydrogen; pressure swing adsorption gives 99.9%+ purity.
4. **Captive use or pipeline delivery** Most hydrogen is used where it is made. Merchant hydrogen moves by pipeline, tube trailer or as liquid at -253 C.
5. **Conversion to ammonia, methanol or fuels** About a third of hydrogen goes into ammonia (about 34 Mt H2 in 190.5 Mt NH3, IFA 2024).
6. **Low-emissions supply** Installed electrolysis capacity reached 2 GW in 2024, 65% in China (IEA GHR 2025).

#### Made from (commodity table)
[Gas Natural gas](https://www.materialinsights.org/energy/natural_gas/)[Tc Thermal coal](https://www.materialinsights.org/energy/thermal_coal/)[H₂O Water](https://www.materialinsights.org/commodities/water/)

#### Three things to know

- The world uses almost 100 Mt of hydrogen a year and under 1% of it is low-emissions (IEA 2025).
- Grey hydrogen costs about $1-2/kg from gas; India's first refinery green hydrogen tenders cleared at $4.4-4.6/kg in 2025.
- Announced low-emissions supply for 2030 shrank from 49 Mt to 37 Mt a year between the 2024 and 2025 IEA reviews.

#### Read the tabs
[Production route](https://www.materialinsights.org/chemicals/hydrogen/routes/)[Production](https://www.materialinsights.org/chemicals/hydrogen/production/)[Feedstocks](https://www.materialinsights.org/chemicals/hydrogen/feedstocks/)[Cycles](https://www.materialinsights.org/chemicals/hydrogen/cycles/)[Trading](https://www.materialinsights.org/chemicals/hydrogen/trading/)[Movement](https://www.materialinsights.org/chemicals/hydrogen/movement/)[Regulation](https://www.materialinsights.org/chemicals/hydrogen/regulation/)[Characteristics](https://www.materialinsights.org/chemicals/hydrogen/characteristics/)[Emissions](https://www.materialinsights.org/chemicals/hydrogen/emissions/)

## Other sections

- [Summary](https://www.materialinsights.org/chemicals/hydrogen/index.md)
- [Correlation](https://www.materialinsights.org/chemicals/hydrogen/correlation/index.md)
- [Production route](https://www.materialinsights.org/chemicals/hydrogen/routes/index.md)
- [Production](https://www.materialinsights.org/chemicals/hydrogen/production/index.md)
- [Feedstocks](https://www.materialinsights.org/chemicals/hydrogen/feedstocks/index.md)
- [Cycles](https://www.materialinsights.org/chemicals/hydrogen/cycles/index.md)
- [Trading](https://www.materialinsights.org/chemicals/hydrogen/trading/index.md)
- [Movement](https://www.materialinsights.org/chemicals/hydrogen/movement/index.md)
- [Regulation](https://www.materialinsights.org/chemicals/hydrogen/regulation/index.md)
- [Characteristics](https://www.materialinsights.org/chemicals/hydrogen/characteristics/index.md)
- [Emissions](https://www.materialinsights.org/chemicals/hydrogen/emissions/index.md)
- [Relationships](https://www.materialinsights.org/chemicals/hydrogen/links/index.md)