6.05.11 - p-48-top - FEATURED

There’s more in a barrel of oil than just gasoline

I know the media has been focusing a lot on oil lately, and understandably so given prices at the gas pump. But often overlooked is oil’s broader use throughout our economy – in often surprising ways. Put simply, oil is fundamental to almost every aspect of modern life.

In addition to producing gasoline and other transportation fuels, oil is used to make an array of products essential to the way we live – everything from life-saving medical equipment to the plastics used in computers and cell phones.

First, a few facts: Gasoline accounts for less than one half of the products made from a barrel of crude in the United States. Roughly another third goes to making the diesel and jet fuels that power commercial transportation and personal travel.

So what about the rest of the barrel?

Oil is an important source of raw materials for making plastics and other chemical products. When crude is refined, two of the products that result from additional chemical processing are ethylene and propylene; these petrochemicals are the building blocks of modern plastics.

Lightweight and versatile, plastics have become ubiquitous in the home (appliances, toys, flooring), in the workplace (computers, desks, carpeting) and on the road (plastics make up about 50 percent of the volume of cars, although they account for only about 10 percent of the weight, according to the American Chemistry Council).

Crude oil is also the source for aromatic fluids, which are raw materials used in a wide variety of products – everything from dyes and synthetic detergents to the polyurethanes used in athletic shoes and furniture to the polyesters used in fabrics and beverage containers.

It would be difficult to overstate the role that petrochemicals have played in achieving the quality of life we enjoy today. Modern healthcare would be impossible without medical products made from petrochemicals – such as disposable syringes, catheters and blood bags, as well as artificial joints used in hip and knee replacements. Even common hand sanitizers are 65 percent petrochemicals.

Cell phones and smart phones wouldn’t exist without components made from oil. These modern electronics contain plastics derived from petrochemicals.

As the National Academy of Engineering once put it, “The products from petrochemicals have played as great a role in shaping the modern world as gasoline and fuel oils have in powering it.”

Here are some other ways that Americans use crude oil:

  • As a home heating oil. Roughly one in 10 U.S. homes uses heating oil – also called fuel oil – to keep their homes warm in cold weather.
  • As a lubricant. Crude oil is used to make lubricants for car engines and other kinds of motors and moving parts in U.S. homes and businesses. In fact, proper function of wind turbines depends on lubricants made from petrochemicals and oil.
  • To make asphalt. Crude oil is the main ingredient in asphalt, which is used to make roads and roofing materials.
  • As an energy source for manufacturing. Another product made from crude oil is petroleum coke, which can be used as a fuel for U.S. industries such as steelmaking. It also is used to make electrodes and charcoal.

I have only scratched the surface of products that are made from crude oil. Crayons, car tires, cosmetics … the list goes on.

In just these few examples, you can see why oil is referred to as the “lifeblood” of the U.S. economy. It powers not just our cars, but also our commercial transportation. It heats homes, keeps industries running and paves our roads. It is an essential ingredient in the products of modern chemistry that keep us healthy, safe and productive.

The importance of this discussion is more than just an interesting “did you know,” however. Policy decisions made about access, taxes and regulations for the oil industry also affect our ability to supply affordable and reliable raw materials for products consumers use everyday.

So, when some politicians, celebrities and even other companies talk about getting “off oil,” I hope they realize what that would really mean for our way of life – because it might make them think twice.


9 Comments

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  1. Gerald Leddin says:

    I can remember when there were more natural and renewable non-polluting sources being used being used for many of the petro-products we have now and oil was being used as an energy source. Yes, it was sold to the public as cheaper replacements at the beginning, that has changed now. Not so cheap anymore!

  2. Barrel Full says:

    There is a good argument that heating oil should be replaced as much as possible with natural gas. It is cleaner, and in the USA today, cheaper.

    There is also the opportunity to replace some of the petrochemical feedstock with natural gas based alternatives. To the extent that it is available, investments are being made in this area.

    However, to move away from oil completely? That’s an invitation to the dark ages, until alternative technologies are much better developed.

  3. James Hagan says:

    So, we ignore climate change and ocean acidification and burn all the fossil fuels we can find? That’s your message? If you want to “burn, baby, burn” you have to find a way to do that sustainably. Or is the commitment to sustainability on your webpage just lip service?

  4. vicki vance says:

    This comment page looks like a real cheap way to do marketing research. Find out how bad your image is, what people are saying, and then have a team that dreams up superficial half-truths and lies to put in TV ads.

    Big oil may have a few Repubs brainwashed—they are sheep anyway—but no Democrat is going to listen to this nonsense.
    Planet trashing is no longer going to be ignored.

    • Martin Capages, Jr. says:

      Dear Ms. Vance: I am sorry you feel the way you do. I worked for Exxon for 15 years then joined another petro company for 8, mostly in the technical side of the exploration and production energy sector. I left that industry in 1992 and started my own engineering company not in the energy sector. For the record, the Exxon motto was to “Follow the course of highest integrity”. I never saw a departure from that philosophy in 15 years. So I take exception to your “half-truths” comment. There really is no such thing as”Big Oil”, certainly not with respect to US Energy Corporations.. But the term does make a good target for those demonizing a particular business sector. Please understand that there is a difference between profit and profit margin. Big profit comes from large volume and high prices. Its the profit margin that is the real measure and the petroleum energy sector is lower than most industry. The petroleum industry pays it fair share of taxes and follows the rules to the letter. There is particular attention to anti-trust compliance. Question for you, what about GE not paying taxes last year but has monopoly in “green” like wind turbines, curly light bulbs, insurance, capital investment firms and extremely high political connections. There’s a big industry target for you. What exactly is “planet trashing”? Perhaps you are referring to man-made global warming caused by CO2 emissions? I’m sorry I don’t think that’s really happening. Its more of a sun, earth wobble, ocean temperature variation thing, not the small amount of man-made CO2 addition to the natural CO2 and other green house gases, the largest being water vapor. I don’t think… read more »

      …Exxonmobil has to run this blog to assess their image. The problem with the whole energy sector is that it has not been able to get the facts out to the public about the real energy business. You may email me if you want a little more insight. Kind regards, Martin Capages, Jr. Ph.D., P.E.

      • Lou McDade says:

        Dr. Capages,
        Fine rebuttal, but w/respect to the comment on GE’s lack of paying taxes, I’d say the problem truly reflects the US’s antiquated tax code. GE has a finance arm that takes advantage of this tax code. Recently the New York Times put out a fascinating article that highlights how GE does it. In short:
        1. GE loans Ireland cash (at interest) to purchase GE manufactured aircraft engines.
        2. This obviously has a benefit for the country of Ireland because it helps w/transportation, logistics, tourism, etc.
        3. This benefits GE much more because: a) they make money on the interest from the loan, b) they are getting their money back because Ireland uses the borrowed money to purchase the engines, c) “and most importantly” the profits earned aren’t taxed because the profits were not earned in the U.S. They are officially earned in Ireland.

        I don’t fault GE, I fault the US government for being behind the curve when it comes to setting weak / lax tax laws. Private industry once again trumps the government. Believe me, I would like to see this lost tax revenue benefit our country, but I can’t fault private industry for being shrewd.

        …The genesis of this article is the myriad ways in which petroleum improves our quality of life by helping to provide us w/products that many of us take for granted. This is a great forum for debate. I hope we can get back on topic. ;)

        • Martin Capages, Jr. says:

          Mr. McDade: Thank you for your kind words. My comments on GE’s legal tax avoidance was just provided to show contrast in media coverage and public perception with the facts. You are absolutely correct in stating the problem is the US tax law. The structure promotes special interests. In my opinon, all taxes should be replaced with a consumption based tax which would reward conservation. It is interesting that environmental activists haven’t discovered that interesting effect of a “fair tax”. They also haven’t discovered that hydrocarbons are a solar derivative energy source with the lowest environmental footprint when compared to other energy sources. Human error and mechanical failures have occurred in the exploration, production and transportation of hydrocarbons but the record shows much improvement even with increasing technical challenges. I agree, let.s get back on topic. Sincerely yours, Martin.

  5. Gary Ansorge says:

    I expect somewhere in such companies is a long range plan for the exploitation of Titan(and if there isn’t, there should be), since it rains methane and has liquid hydrocarbon lakes. Granted, this is century long planning but any consortium that controls Titan will have hugh profit potential in sales of hydrocarbon products to the entire solar system, since it’s nearly all down hill from the orbit of Titan. Solar sail propelled “tugs” could haul those materials on years long orbits to the inner system. Talk about a long pipe line,,,

  6. James Cane says:

    There are three separate issues here: climate change, foreign oil dependence and energy security.

    Regarding climate change, we don’t need to stop using oil, we just need to cut down how much of it we burn. Carbon dioxide is the direct problem, not oil. This problem is urgent and requires much more serious attention than it’s currently receiving.

    Regarding foreign dependence, our dependency is not directly on the petrochemical raw materials anyway, but is usually at the level of the finished product and the entire supply chain. And as an exporting country, that dependence works two ways. What does “dependence” even mean in this context?

    Regarding energy security, our dependency clearly is directly on foreign oil. There are many solutions out there, including the nuclear elephant in the room, but we need clear political leadership.

  7. Gerald Leddin says:

    I can remember when there were more natural and renewable non-polluting sources being used being used for many of the petro-products we have now and oil was being used as an energy source. Yes, it was sold to the public as cheaper replacements at the beginning, that has changed now. Not so cheap anymore!

  8. Barrel Full says:

    There is a good argument that heating oil should be replaced as much as possible with natural gas. It is cleaner, and in the USA today, cheaper.

    There is also the opportunity to replace some of the petrochemical feedstock with natural gas based alternatives. To the extent that it is available, investments are being made in this area.

    However, to move away from oil completely? That’s an invitation to the dark ages, until alternative technologies are much better developed.

  9. James Hagan says:

    So, we ignore climate change and ocean acidification and burn all the fossil fuels we can find? That’s your message? If you want to “burn, baby, burn” you have to find a way to do that sustainably. Or is the commitment to sustainability on your webpage just lip service?