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Making an overview of the use of oil and gas in the industry

When thinking about oil and gas, many think about filling-up their car or warming their house. However, about a quarter of the oil and gas produced in the world is used in the industry. Actually, about 10% is not even combusted, but rather transformed into products.

In an analysis for the Norwegian oil and gas association, we mapped the use of oil and gas products in the world, with a focus on Europe. We established that 15% of the products were used as energy source in the industry, while ca. 10% is non-energy use, that is to say mostly used as raw materials. 

In OECD countries 74% of the non-energy use is for the chemicals and petrochemicals industry, another 12% is used in the construction segment
(mostly bitumen), and smaller amounts are used across other industry segments, in housing and
services, and transports (mostly lubricants).

Share of oil and gas to non-energy use and industry, world, 2015 (calculated, based on IEA, 2017)

Endrava’s analysis of the petrochemical industry shows that the main final products are plastics (63%), fertilisers (21%), solvents and rubber. The demand for oil and gas as non-energy products therefore follows closely the output of the chemical and petrochemicals industry.

Production flows in the chemical/petrochemicals industry in the world (calculated, based on data from IEA 2017 and other sources)

There, the demand for plastics products plays a major role, and plastics production has been increasing steadily since they were first introduced in the early 1950s. The demand follows the GDP, and is expected to reach more than 1,000 Mt in 2050 (vs. ca. 350 Mt in 2016). A large share of the plastics products is used for packaging. A reduction in the use of plastics products, their re-use and recycling could be three parameters impacting the plastic demand in the future, although their future effect is uncertain at the moment. In addition, the production of bio-based plastics (from renewable sources) is increasing, but still fails to have a significant impact on the total demand for oil and gas products as feedstock to plastics production.

Use the link below to access the complete report about the use of oil and gas in the industry.

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