September 4, 2020 Read More →

Fossil fuel companies pouring resources into plastics industry

The New Republic:

What do you do if you’re an oil company with too much oil? You find a place—any place—to put it. If people aren’t driving or flying as much, they’re certainly having things delivered. That’s where the oil comes in, delivering the raw materials to make the plastic enveloping all those Amazon and Postmates orders or to make bottles of water and various useless tchotchkes at home and abroad. 

There’s just one problem: According to a new report, plastics might not be as popular in coming years as oil companies hope. And with a dizzying amount of it on track for production, that could mean a lot of plastic waste with nowhere to go.

Kathy Hipple, an analyst at the Institute for Energy Economics and Financial Analysis, says petrochemicals are just another sign of the fossil fuel industry’s mounting distress. “The whole fundamental financials of the oil and gas industry are very shaky right now. The industry is extremely vulnerable. The market capitalization of some of these companies is less than half of what it was a few years ago,” she said, pointing to the fact that—with ExxonMobil now delisted from the S&P500—energy now accounts for just 2.34 percent of that index. “Oil companies are struggling to figure out their next move, and my view is that legacy companies rarely pivot sufficiently in time.” Ørsted, the Danish state-owned oil and gas company, is one of very few examples of companies that have successfully diversified into renewables. “But it’s also controlled by the Danish government, and the Danish government made a bold decision,” Hipple said. 

[Kate Aronoff]

More: Big Oil’s Evil, Stupid Plan to Drown the World in Plastic

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