A few months ago, we published an article about the drop in crude oil prices worldwide. Yesterday, Jan. 19, Huffington Post reported an additional decrease in crude oil prices nationally and internationally. Oil prices were below $28 per barrel on Monday, which is the lowest price since 2003 according to Huffington Post.
With crude oil prices continuing to decrease, we are keeping an eye on the market to see when and how we can help you save money on Karat® food service disposables. Remember, When Karat saves, you save!
See below for our last post on oil prices:
Changes in oil costs may be affecting your prices
Originally posted Nov. 2, 2015
The slow and steady drop in oil prices over the past year has many concerned for the health and stability of the economy. This decrease in crude oil costs has been in progress since late 2014, according to Plastics News.
The future of these prices and whether they will increase significantly is still uncertain. Some prices have increased to almost $50 a barrel (compared to $45 and below), but these small increases seem to be short-lived.
It has been predicted that prices will begin increasing slightly in 2016, from about $49 to $53 according to the U.S. Energy Information Administration (EIA); however, the EIA crude oil price summary illustrates that these increases are far from where we once were with crude oil costs.
The plastics industry is often heavily affected by economic changes like these. In the case of cheaper oil, this is actually slightly beneficially to manufacturers like Karat®, as well as its customers. This could be considered a silver lining to the volatile and unclear future of the oil market.
“The plastics industry can expect to have relatively low oil prices for the next two or three years as demand catches up with supply …” according to Plastics News.
For those in the plastics industry this means the price of plastic resins for the creation of foodservice disposables and other plastic products is lower and will probably remain lower for a while. PP, PS and PET resins have all experienced price drops in recent months.
In August, each of these resins experienced a price drop, with PET having the largest decrease in price (4 cents), according to Plastics News. By September, the prices were still lower than normal. Prices have since come up very slightly, but not enough to be felt by those purchasing resin.
Karat has paid close attention to these economic changes and has begun adjusting prices based on how much money is spent on resin. The less money Karat spends on resin, the more money Karat’s customers save on their food service disposable products.