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The auto industry is a competing use of oil, isn’t it? So halving demand is more likely to reduce prices. Car industry obviously helped to build the infrastruc
by richardw 3y ago
The auto industry is a competing use of oil, isn’t it? So halving demand is more likely to reduce prices.
Car industry obviously helped to build the infrastructure but I think now that it’s there, fair chance there’s going to be a lot of oil supply looking for a use. Infrastructure won’t disappear overnight.
- RetpolineDrama 3y ago>So halving demand is more likely to reduce prices. 1) Halve demand 2) Price plummets 3) Sources shut off 4) Prices climb again, _but at lower volume_ Plastification requires $x/barrel oil _at insane volume_ to work.
- marcosdumay 3y agoThe key thing people are talk over each other here is that step #3 takes years. But also, plastics can pay much more for oil and gas than fuel can. It's currently not scarce at all, and the economic restrictions are all around using the plastic in some way. So don't expect the plastic industry to suffer like your last paragraph implies.
- audunw 3y agoDo you know how fractional distillation works? Fuel doesn’t compete for oil. Fuel, bitumen and other heavy fractions is the main reason we distill oil. Those are the hydrocarbons that are actually hard to make. The light fractions used in plastics fall out of that process. It’s not a competition, it’s a synergy. If they’re going to turn ALL the oil into plastics, at the very least they have to have more processing steps. It’s not hard but it will require bigger refineries, in other words, more expensive plastics. Also, they will be competing with bio-plastics and other alternatives, that will probably get more favourable regulations in many countries. Plastics won’t go away. Even if we don’t pump for oil it’s not very hard to make the same plastics from biological hydrocarbons.