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BP warns war on plastic will help cut global oil demand

BP warns war on plastic will help cut global oil demand thumbnail

he war on single-use plastics could cut demand for oil faster than previously expected over the next two decades, BP has warned.

The oil major predicted a peak in global oil demand for the first time last year, and in its latest outlook report warned that a crackdown on plastic waste, which is made from fossil fuels, could play a role in slowing oil demand.

BP expects demand for oil to rise 0.3pc a year before plateauing in the 2030s.

The “much slower” growth forecast is well below what BP predicted even two years ago.

Last year, its central forecast scenario predicted the world’s appetite for crude would grow by 0.5pc a year through the next decades before peaking in the late 2030s. This was down from growth predictions of 0.7pc a year between 2015 and 2035 in its 2017 report.

Bob Dudley, BP chief executive, said the report highlighted how quickly the world’s energy systems were changing.

He said the “dual challenge” of meeting the world’s rising demand for energy while driving down greenhouse gas emissions was “one of the biggest challenges of our time”.

The latest demand scenarios, which range from between 80m and 130m barrels a day, meant oil would still occupy a “significant role in the global energy system in 2040”, according to BP.

The world consumes about 100m barrels of oil a day.

Mr Dudley said the transition would require “many forms of energy to play a role”.

Many major oil companies are increasing their investment in clean energy. They are also turning their attention to the market for petrochemical compounds, used as building blocks for consumer goods.

However, BP’s latest report points to a growing concern over single-use plastics that could take a toll on oil demand as well.

BP expects government policy around the use and recycling of plastics to tighten over the next 20 years, and double recycling rates to about 30pc.

Single-use plastics accounted for just over a third of all plastics produced in 2017, of which only a fraction is recycled, while the rest is piled into landfills or into the world’s oceans.

Tightening regulations would cut the growth in oil demand by about 3m barrels of oil a day relative to a continuation of past trends, BP said. This was deeper than the 2m barrel cut predicted by BP just last year.

A worldwide ban on single-use plastics could erase as much as 6m barrels of oil from its demand forecasts for 2040.

Although the plastics crackdown will be offset by a rising demand for petrochemicals for most other modern products, it is one of a growing number of global trends that threaten to reduce the world’s reliance on oil faster than major oil companies expect.

BP has come under fire in the past for downplaying the impact that renewable energy and electric vehicles will have on the fossil fuel industry in past reports.

In its latest report the company again increased by 30m the number of electric cars it expects to see on the world’s roads in the coming decades, to 350m.

The fresh figures are well above its 2017 prediction that electric vehicles would number only 100m by 2035.

The oil group also nudged its renewable energy forecasts higher for a sixth consecutive year as costs continue to fall.

BP said it expected 7pc annual growth for renewable energy, meaning sources such as wind and solar will account for 15pc of global demand by 2040, overtaking coal as the largest single source of power.

17 Comments on "BP warns war on plastic will help cut global oil demand"

  1. Davy on Fri, 15th Feb 2019 5:29 am 

    I am still maintaining an economic cycle of decline is near that will be the real peak demand force for oil. We see Europe and China already in a noticeable decline and the US will not be far behind. These powers wag the tail of the rest of the world so the rest of the world will follow. No way to know the degree or duration of this decline but from my daily reads it will be noticeable and likely not end. This is my opinion and I am a mild doomer.

    I say this because tools of reflation have hit diminishing returns. There is no particular reason for this decline like 08 when it was the subprime and inflated property markets. Now it is across the board exhaustion of Ponzi activities. Bubbles are running their course. The social fabric is fraying from a decade of wealth transfer. Central bank easing and the repression of rates have hit diminishing returns but we are stuck with them as the brief period of an attempt at normalization attests to. Fed normalization barely started and the global system was beginning a cascade of decline.

    This is about an across the globe aggregate demand dropping into a new normal of a declining real rate of growth. So what I am saying is growth is slowing and it will be this process of slowing that will eventually turn into an actual decline in other words no growth. Because we have growing populations yet and ample resources this will be a process. We have marvelous tech and strong industrial processes that will maintain growth impulses within this aggregated macro situation of systematic stagflation.

    This stagflation will likely turn into an actual recession without end and it is this type of situation our modern civilization has never experienced. Short periods of decline are a different story. This will be stagnation followed by a long period of decline. Populations will follow eventually. Let us hope we find a point of stasis. Oil is going to have other forces of demand destruction but it is the economy that will cement peak oil demand and likely soon.

  2. Davy on Fri, 15th Feb 2019 5:44 am 

    “Actually, Econ 101 Is Incredibly Important”

    “Here’s just a partial list of what an attentive Econ 101 student learns:

    Our world is one of unavoidable scarcity, and so to use more resources to produce guns is to have fewer resources available to produce butter. There’s no such thing as a free lunch, a free gun, or a free anything else.

    Wealth is goods and services; wealth is not money. And so to create more money without creating more goods and services is to create, not more wealth, but only more inflation — along with the distortions and uncertainties that inflation unleashes.

    When the cost that a person incurs to take some action rises, the attractiveness to that person of taking that action falls. This fact is why higher taxes on carbon emissions reduce carbon emissions, and why higher taxes on income-earning activities reduce income-earning activities.

    Profits are entrepreneurs’ reward for successfully satisfying consumers’ wants; profits are neither stolen from consumers nor extracted from workers. Therefore, the greater the good performed in the market by entrepreneurs, the higher the entrepreneurs’ profits.

    Prices and wages aren’t arbitrary. They’re set in markets by consumers competing against each other to purchase goods and services, and by sellers competing against each other to sell goods and services. Sellers in competitive markets no more control prices than do buyers.

    Because of the principle of comparative advantage, it’s literally impossible for one country to monopolize the production of all goods and services.

    I submit that these and other lessons taught in Econ 101 are vitally significant and need not await being polished and conditioned by the lessons of higher-level economics courses before becoming immensely useful. Far from being dangerous, these and other Econ 101 lessons are beautiful and essential.”

  3. Davy on Fri, 15th Feb 2019 5:57 am 

    “Fifty Shades Of Shale Oil”

    “Considering that the majority of U.S. tight oil production growth is generated by a single field, the Permian, changes in the growth outlook of this basin have major implications as to the evolution of global oil prices over the short, medium and long term. Its important to keep in mind that the Permian oil field, despite its large scope, is bound to flatten, peak and decline at some point. While forecasters differ as to the exact year when the Permian oil production will flatten, the majority agree that a slowdown in Permian oil production growth will take place in the early 2020s.”

    “There are many factors that can accelerate or delay the projected flattening phase, but there is no doubt that sooner or later Permian oil production will flatten. An eventual plateau in Permian oil supply effectively translates into a flattening of non-OPEC global oil supply, the importance of this event can’t be overstated. The year the Permian flattens is the year OPEC will regain control of the market, this seminal event will have major implications on long term oil prices.”

    “The U.S. tight oil story is far more complex than meets the eye, and the oil market, like any market, is prone to the appeal of simple narratives and false conclusions. Those willing to drill behind the headlines stand to capitalize on the treasures buried in the details.”

  4. MinorityofOne on Fri, 15th Feb 2019 6:04 am 

    Davy on Fri, 15th Feb 2019 5:29 am

    I am still maintaining an economic cycle of decline is near …

    I agree in principal but whereas you are a mild doomer, I am inclined to believe that the upcoming decline will be very, very painful, for most of us, irrespective of country we live in.

  5. Davy on Fri, 15th Feb 2019 6:05 am 

    This is an extraordinary example of mal-investment. The US is estimated to have 134MIL apartments.

    “China’s housing glut casts pall over the economy”

    “A massive building boom across China, including in tier-two cities like Jinan, has left as many as 65 million empty apartments across the country, according to estimates by Gan Li, a professor at Southwestern University of Finance and Economics in Chengdu. Sales volumes in 24 cities tracked by China Real Estate Index System fell by 44% in the first week of 2019 compared with a year earlier, though the four largest cities — Shanghai, Shenzhen, Guangzhou and Beijing — still saw a 12% increase. Many analysts now expect China’s home sales to contract this year. Perhaps more worrisome, though, is the growing number of Chinese property companies that appear to be struggling under the weight of heavy debt burdens. Moody’s Investors Service has assigned junk status to 51 of the 61 Chinese property companies it assesses.”

  6. Davy on Fri, 15th Feb 2019 6:22 am 

    My “REAL” green message has this thinking as part of its basis. When looking at my message I maintain this way of life is for the individual and groups in a world that is trapped in a self-organization of decline and decay. Since we cannot break free of this greater force your alternative is a local effort.

    “Why we need ‘ecolocracy’”

    “Dialectics – a theory of natural and social change – is resurgent after a century buried under distorting ideologies. Systems theory – a century in evolution – is emerging as a new metascience. Biomimicry is currently the zeitgeist. Nature can provide the information needed for humans to return to nature, to live within its patterns and limits.”

    “Holacracy, sets out in detail a management system that is consciously and deliberately based on an interpretation of natural systems, and in particular cells and the human body. Robertson invites readers to evolve, to develop, his system. I have accepted that invitation. Ecolocracy is therefore an iteration of Holacracy informed by the philosophy of need. It adds three vital components: firstly, the organisation as a whole must have as its purpose the meeting of human needs. This means the purpose cannot be profit making, or ‘economic growth’ and the organisation cannot enact a net harm, either socially or ecologically. Secondly, the structure is designed so that the needs of the members of the team, the staff, are met. This allows them to contribute to the purpose to the best of their ability. Finally, space is created when needed so that the emergent qualities of social and group work can be developed.”

    “Manifesto The swift journey from global to personal was deeply compelling. I am now interested in materialist dialectics as a universal, philosophical ontology and epistemology. And nested within this a metascience, a general systems theory which provides knowledge of systems: physical, psychic and cultural.”

    “I believe that natural systems – the human body is often the metaphor used – can provide a clear, exact structure for the group – a number of people who have come together to achieve a purpose (for example, social change). The group is the system. A group that consciously, deliberately adopts practices from other systems will be equitable, knowledgeable, fair, effective and resilient.”

    “I will suggest that we can benefit from knowing, learning, mimicking, acting – functioning – in the same way as nature. But we must be conscious nature, self conscious nature. This new form provides an ideal organisational form for environmental, ethical organisations. Ecolocracy is Holacracy by nature, in nature, for nature.”

  7. intellectual nematode Alert! on Fri, 15th Feb 2019 7:43 am 

    Davy on Fri, 15th Feb 2019 5:29 am
    Davy on Fri, 15th Feb 2019 5:44 am
    Davy on Fri, 15th Feb 2019 6:05 am
    Davy on Fri, 15th Feb 2019 6:22 am

  8. Davy on Fri, 15th Feb 2019 8:17 am 

    “Bill Gates Bashes “Extreme” Proposals Of AOC, Mocks MMT “Crazy Talk”

    “During a wide-ranging conversation on The Vergecast about the philanthropic work Bill Gates does around the world with his wife Melinda and their foundation, the Microsoft founder says the tax policies of Alexandria Ocasio-Cortez and others are “missing the picture” and MMT is “crazy talk.” He started off on a positive note (for some) suggesting taxes could be higher…” I believe US tax rates can be more progressive…” “…the estate tax and the tax on capital, the way the FICA and Social Security taxes work. We can be more progressive without really threatening income generation – what you have left to decide how to spread around. But, the world’s second richest man had some qualifiers that poured cold water on “extreme” politicians like AOC…”Now, you finally have some politicians who are so extreme that I’d say, ‘No, that’s even beyond’…You do start to create tax dodging and disincentives, and an incentive to have the income show up in other countries and things…”And mocked “Modern Monetary Theory” which says “Don’t worry about the deficit. We’ll just print the money and do it”? “That is some crazy talk…” “Well, that’s crazy. I mean, in the short run actually because of macroeconomic conditions, it’s absolutely true that you can get [debt] even to probably 150 percent of GDP in this environment without it becoming inflationary. But it will come and bite you. The people you owe the money to, you will have a problem.” Crazy indeed Bill, just don’t tell the Democrats (or you’ll be assuaged – just like Schultz – as a racist, bigoted, elitist billionaire who just doesn’t get it).”

  9. Sissyfuss on Fri, 15th Feb 2019 5:25 pm 

    ” The dual challenge of meeting the worlds rising demand for energy while driving down rising emissions of greenhouse gasses is one of the biggest challenges of our time.”
    Oh, dat be way beyond a challenge, massah.

  10. makati1 on Fri, 15th Feb 2019 5:29 pm 

    So right Sissyfuss. We are beyond any possible cure. About 100 years behind, I think. Greed took over rational thought and here we are.

  11. makati1 on Fri, 15th Feb 2019 5:33 pm 

    Question: How does Davy run a big farm, raise a family and have time to write large doses of bullshit to post here? Pick one:

    A. He has no farm.
    B. He has no family.
    C. He has no life.
    D. All of the above.

  12. Davy on Fri, 15th Feb 2019 5:36 pm 

    Well makati I am smart and can multitask. You are old and worn out. I can understand why you wonder these things. No wonder you are in a 3rd world hole in the wall place with nothing to do.

  13. Not me above on Fri, 15th Feb 2019 5:59 pm 

    Everyone knows that people with families, farms, and lives in general, don’t spend all day long, every day, posting dumbass comments on obscure internet forums.

    So yah.

    D. All of the above.

  14. Anonymouse on Fri, 15th Feb 2019 6:05 pm 

    Hear that mak?, the expcetionalturd is shmart , and you are dumb. That will teach you to talk back to the exceptional one. I will have you know, the delusional one makes more fake posts and cut and pastes in one day, than most people make in an entire year, or life even.

    That is because he is a multi-polar, multi-tasker. He can be multiple A-holes, and not just one A-hole. He can cut and paste, hide behind tinyURLs, project his own failings and mental health problems onto others, run so many sock puppets he cant remember what they said, or to who, and this all within the span of a typical 24 hour period.

    He is a multi-polar dynamo, that also runs a vast .9 acre farm and is an acknowledged expert in…..everything.

    And you are just old and worn out. If you could only be more like the exceptionalturd, then there would two of him. I dont know if the universe could handle that much awesome, probably not.

    So there.

  15. makati1 on Fri, 15th Feb 2019 6:24 pm 

    Anon, your sarcasm is hilarious! I’m glad I am not “intelligent” like he is. They put those people in mental wards here in the Ps.

    How he stays free is the big question. But then, he probably fits right in with his uneducated, inbred, redneck neighbors. You or I would be the odd ones. LOL

  16. Pete Bauer on Sat, 16th Feb 2019 7:44 pm 

    Great deal of effort has been applied to reduce the single use plastic and its successful.

    Some stores dont give plastic grocery bags, some stores charge few cents and some stores ask whether you want a big. Many stores don’t put the milk in a bag now.

    Many people just take the tote bags.

    Also the bio plastics is slowly on the rise. Stores replacing plastic cup with paper cup is also a significant improvement.

    Similarly the asphalt roads should also be replaced with concrete roads which increase fuel efficiency and reduce maintenance.

    Even the asphalt roof shingles can be replaced with solar tiles which are cleaner and also generate electricity.

    Petrochemicals (plastics, nylon, tires, asphalt, lubricants …) take 8% share in Oil with the remaining 92% used as energy.

  17. Free Speech Forum on Sun, 17th Feb 2019 7:38 am 

    If Americans don’t defend free speech, religious freedom, gun rights, freedom from unconstitutional searches and seizures, the right to silence, and the freedom from torture and extrajudicial assassination, what part of the Bill of Rights do they support?

    What country is this?

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