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The Future of Plastics Will Determine the Future of Oil Demand – OilPrice.com

The United Nations is debating the future of plastics this week – on the surface it would seem that way. The United Nations’ Global Plastics Treaty negotiations aim to curb plastic pollution by substantially reducing the use of plastics around the world. And it looks like they’re going to fail.

The goal is certainly a noble one. To reduce the amount of plastic waste we produce on a daily basis and prevent it from ending up in our rivers and oceans. some researchers, our bodies. However, achieving this goal is a completely different matter.


Plastics, especially single-use plastics for packaging, have helped make many products more affordable and available to more people. For example, electronics can certainly be sold in non-plastic packaging, but raw fruits, vegetables, and meat are a different matter and are expensive.

just this week the european union approved New regulations on packaging aimed at reducing waste. In fact, one of these rules was a ban on single-use plastic packaging for raw fruits and vegetables from 2030. This means that from that year, for example, tomatoes will probably be sold in cardboard packaging. This would make them more vulnerable and lead to increased food waste by supermarkets. If that happens, the price of tomatoes as a whole will increase. And it affects more than just tomatoes.


So while the goal of reducing plastic pollution is noble, it seems harder to achieve than it seems. The United Nations talks themselves are a good example. In a recent update, an environmental NGO attending the event said the US had refused to consider any additional moves beyond the current law on plastics. If the world’s largest plastic-using country refuses to consider anything in addition to existing laws, there is no chance that the rest of the world will agree to anything that could have a tangible impact on plastic use. Not necessarily big.




But the oil industry is concerned. Media outlets report in The Guardian that UN talks in Ottawa had a large attendance from the oil and petrochemical industry. lament the fact “Fossil fuel and petrochemical activists outnumbered scientists, the EU, and Indigenous representatives at the Ottawa Summit.”

The report cited BP’s prediction that plastics will account for as much as 95% of oil demand growth in the 20 years to 2040, which is in line with many other forecasts on the oil demand outlook. We are doing so. In fact, plastics are widely considered to be the biggest driver of future oil demand, but given the latest developments in the EV market, you may be surprised at how long demand from the transportation sector will last.

So it’s no wonder the oil industry is trying to protect this demand factor. It’s also backed by solid science. Plastics play a huge role in making modern healthcare safe, and perhaps more importantly, they play an equally huge role in making more food affordable and available to more people. I’m making a contribution. Simply because plastic packaging reduces the cost of transporting and storing food. food. While plastics used in medicine are exempt from the ban, the ban does target plastics used in food packaging, at least for now.

“The problem is pollution. The problem is not plastic,” Karen McKee, director of product solutions at Exxon, recently said. Said “Restricting plastic production is useless from a pollution and environmental perspective,” the FT said.

Alternatives to plastic packaging could result in even greater emissions, McKee argued.


If this sounds familiar, it’s probably because the argument against transportation electrification takes into account all the raw material mining, refining, and processing inputs into EVs that cast a shadow on zero-emissions qualifications. Probably because it reminds me of.

The simple truth is that plastic is used on such a large scale because one, it’s convenient, and two, it’s cheap. Plastic ban proponents will need to come up with alternatives that offer the same combination of convenience and price if they are to have any chance of succeeding at a meaningful scale.

This situation reflects the energy transition itself. Wind, solar and electric vehicles, not to mention hydrogen, have consistently failed to usurp the top spot in the world’s energy mix from oil, gas and even coal. This remains true even though the expansion of wind and solar has significantly reduced the competitiveness of gas and coal generation without similar subsidy measures.

Sadly, the alternative to banning plastic production would be better disposal processes and more recycling. Unfortunately, for this to work, recycling also has to be profitable, and much of it simply isn’t. The world has a plastic waste problem. A ban may solve this problem, but it could create new, more serious problems. That’s certainly a serious conundrum.

Written by Irina Slav for Oilprice.com

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