Korean refiners are stepping up efforts to tap the immersion cooling oil market, which is used to cool heat generated by data centers and energy storage systems (ESS). The push follows projections that demand for immersion cooling oil will surge as the global artificial intelligence (AI) market rapidly expands.
According to the refining industry on the 20th, HD Hyundai Oilbank said on the 14th via its official social media (SNS) that it supplied its immersion coolant XTeer E-Cooling Fluid to the Korea Institute of Ceramic Engineering and Technology (KICET), under the Ministry of Trade, Industry and Resources, and began demonstration testing. KICET and immersion-cooling system operator Databean plan to use HD Hyundai Oilbank's immersion coolant to cool servers.
Immersion cooling is a cooling technology that cools electronic components such as data center servers, ESS, and graphics processing units (GPUs) with a special nonconductive liquid (coolant). In particular, as data centers rapidly increase with the spread of AI, immersion cooling is drawing attention as a technology that can boost space efficiency and reduce power consumption.
Previously, data centers mainly used air cooling, running large air conditioners to circulate cold air under floors or through aisles. There is also liquid cooling, which routes coolant over heat-heavy core components such as GPUs and central processing units (CPUs), but this method applies only to core parts, leaving the rest to be cooled by air.
However, because air cooling entails significant expense and space burdens due to the installation of large air conditioners, the energy industry expects immersion cooling to become the mainstream next-generation data center cooling method.
The outlook for the immersion cooling market is bright. According to global market research firm MarketsandMarkets, the global immersion cooling market is expected to grow from $570 million in 2025 to $2.61 billion in 2032. The compound annual growth rate is estimated at 24.2% from 2025 to 2032.
Korean refiners are rolling out immersion cooling oil for commercial use one after another. SK Enmove succeeded in developing immersion cooling oil for data centers in Korea for the first time in 2022. In 2023, it supplied immersion cooling oil to an SK Telecom data center. In 2024, it also commercialized immersion cooling oil for ESS in partnership with Hanwha Aerospace. It is currently working with global solution corporations such as Dell Technologies and Iceotope in the United Kingdom.
S-Oil has been selling immersion cooling oil in the domestic energy storage system (ESS) market since Aug. last year.
Following its supply of immersion cooling oil to the Samsung SDS data center in 2024, GS Caltex also supplied immersion cooling oil in 2025 to the LG Uplus data center and the QAI data center. GS Caltex is also working with semiconductor and server manufacturers such as Samsung Electronics and Super Micro Computer to verify interoperability between immersion cooling oil and servers and components. In addition, together with LG AI Research, it plans to carry out a research project to discover and synthesize new materials for immersion cooling oil using EXAONE (LG AI Research) Discovery.
An industry official in the refining sector said, "Immersion cooling is a promising new business expected to grow rapidly along with the spread of AI data centers," adding, "We are expanding our business scope by conducting demonstration projects not only for large data centers but also for small servers."