Why Rising Oil Prices Create a Strategic Opportunity for Recycled Plastic

For decades, the economics of plastic have been tightly linked to oil.  Virgin plastic is produced from petrochemical feedstocks such as ethane and naphtha, meaning its cost rises and falls with fossil fuel markets. When oil prices were low and stable, especially during much of the 2015-2020 period, virgin resin was often so inexpensive that recycled plastic struggled to compete on price alone.  That dynamic suppressed demand for recycled resins and constrained investment in collection, sorting, and processing infrastructure.  Collection during the pandemic also became difficult, driving up recycled content prices, and even putting many recyclers out of business.

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