More on speculators and oil prices. (page 1 )
Airline fuel costs. (page 1 )
Is nuclear power really dead? (page 3 )
China and Vietnam – tension over oil. (page 3 )
Pedal power. (page 4 )
Plastic packaging and Peak Oil – Really…!
The New York Times had an article on Thursday that hit at how the price of oil may put an end to one of those little frustrations of modern life. “High oil prices have manufacturers and big retailers reconsidering the use of so much plastic, and some are aggressively looking for cheaper substitutes.”
There is much more to this story than just relieving a little frustration. It gives a look at just how deeply petroleum has penetrated our daily lives without consumers being aware.
“Clamshells actually served that purpose really well for the last 20 or 30 years,” Mr. Kellogg said. Then, petroleum prices rose, first in 2008 and again this year, so the cost of producing clamshells and other plastic packages, which are petroleum-based, shot up.”
The price of plastic is not being driven higher by plastic demand but by the combined demand for all petroleum and petrochemical products. The linkage between the gas tank of a consumer’s car and the cost of products at their favorite retailer is not obvious. The result is a disconnect in the public’s thinking when it comes to energy policy that is misdirected solely towards the headline price of gasoline.
For example; a shift of more natural gas to transportation intended to mitigate fuel prices could cause the price of fertilizer, home heating, electric power generation and plastics to go up since natural gas is fundamental to all of them. As fertilizer and home heating rise less money will be left from the food and home heating budget for other purchases including transport fuel.
There may be a silver lining to this tale. If the replacement for the plastic packaging is done with attention to the full lifecycle of the material the amount recycled could climb and the amount headed to the landfill could fall. So the loss of a little packaging frustration could yield even bigger and longer lasting benefits too.
Some graphs to think about.
This graph shows the price trend in world crude oil since January 1, 1999. The white trend line has reached $90 per barrel. Keep that trend line in mind when considering your personal energy lifestyle.
This graph illustrates the annual average world crude oil price for the first six months of each year except 2011 which is year-to-date through May 27th. Note that even with the recent downturn in crude prices 2011 is still running ahead of 2008. This will change in the weeks ahead with the steep run-up in 2008 kicking in unless prices in June turn up dramatically.
Finally here is a graph that MRR frequently shows illustrating the relationship of U.S. gasoline consumption to price. Note that despite the price of gasoline climbing from below $2 per gallon consumption has hovered around the 9 million barrel per day level over the 6 ½ year period. Considering the severity of the recession that began in late 2007 this is surprising to many not aware of the global supply situation.