Plastic bans could hit growth in oil demand: BP

Bans around the world on single use plastic items such as carrier bags will hit growth in oil demand over the next two decades, according to BP.

However, according to the UK-headquartered oil and gas firm, it still expects the global hunger for crude to grow for years and not peak until the late 2030s.

Spencer Dale, the group's chief economist, said, ''Just around the world you see increasing awareness of the environmental damage associated with plastics and different types of packaging of one form of another, The Guardian reported.

''If you live in the UK that's clearly been an issue, but it's not just a UK-specific thing; you see it worldwide, for example China has changed some of its policies.''

According to Dale, such measures around the world could mean 2 million barrels per day lower oil demand growth by 2040.

He added however, that single use plastics were only about 15 per cent of all non-combusted oil, which is used for petrochemicals, an industry that BP expects to be a big driver of global growth in crude demand.

According to the company's outlook report published yesterday, demand is expected to peak at about 110 million barrels per day between 2035 and 2040, up  from around 97 mb/d today. Much of the growth would be driven by rising prosperity in the developing world.

Global demand for crude is expected to level off during the late 2030s, mostly due to the rise of electric cars and trucks, BP predicted yesterday in its annual outlook.

According to the company's projections 320 million electric vehicles will be on the road by 2040, as against 2 million in 2016. The company expects electrics to hit a tipping point and really take off after 2035.

According to commentators, the prediction comes as more evidence of a dramatic shift in appetite for oil. They add that the talk of peak oil demand from one of the world's largest oil producers, shows how the thinking in the energy market has changed.

People were worried about the opposite problem a decade ago, a peak in how much oil could be pumped out of the ground. Oil prices briefly hit $147 a barrel on those fears.