Risk to Resilience: Rethinking Oil-Based Inputs In An Increasingly Unstable World

In today’s volatile political climate, it can feel like sustainability should take a back seat. With growing concerns of war, tariffs, inflation, and extreme weather dominating the headlines, doubling down on R&D and next-gen materials may seem irresponsible.

But what looks like a risky spend could actually be a strategic investment in resilience. Oil prices might not be top of mind for brands, but they can impact businesses in unexpected ways. Many companies rely on global supply chains, with critical inputs such as packaging, components, coatings, and textiles still heavily dependent on fossil fuel-derived materials.

The relationship between oil prices and geopolitical developments is complex, however global events can instigate reduced economic activity and disrupt commodity supply (European Central Bank). Historically, upward pressures on oil prices have been short lived. However, as global disruptions increase in frequency or scale, these pressures may also persist. Consider the Middle East, home to around 55.5% of the world’s known oil reserves (Statista). Adding to the pressures of oil as a commodity input is the growing risk of resource scarcity. Oil is a finite resource. The dynamic of rising demand coupled with global uncertainty has the potential to create serious economic risk (Investment Management and Financial Innovations).

How does this relate to brand needs?

Plastic is derived from oil. The Center for International Environmental Law states that “over 99% of plastic is made from chemicals sourced from fossil fuels” (CIEL), while a 2021 Changing Markets report confirms that around 69% of the materials used in textile production are crude oil based. Despite our oil addiction, plastic bans and carbon levies are accelerating worldwide, with the EU leading the way in single-use plastic bans and mechanisms for carbon taxation (WEF, Sustainability Magazine). In the US, states are moving to enact extended producer responsibility legislation on packaging, creating revenue and incentivizing a shift away from plastic (Sustainable Packaging). Together, these policy shifts are creating a regulatory environment that compels companies to embrace more circular, low-carbon material strategies.

The United States — despite its recent attempts to become a more isolationist nation — remains part of the global trade network. According to the Federal Reserve, 30% of intermediary inputs (energy, raw materials, and semi-finished goods) come from global imports. These various commodities — many oil-based — can fluctuate in price and availability as a result of geopolitical conflicts or resource scarcity.

The Benefits of Bio-Based

Given the current landscape, the time to move away from fossil-based inputs is now. Recent geopolitical tensions in the Middle East caused a 12% spike in oil prices and uncertainty in financial markets (Financial Times). While this pressure is expected to level out, barring an escalation in conflict, the pressures on oil-derived materials are no longer hypothetical, they're material business risks. In this context, alternative materials aren’t just a sustainability play, they’re a strategic lever for resilience. But jumping on the bio-based bandwagon must be approached rigorously, vetted for performance, scalability, and carbon footprint to avoid solving one problem by creating another (Carbon Minus).

Bio-based materials are derived from plant or animal biomass and used as raw materials (Science Direct). They span a wide range of feedstock including corn, hemp, algae, mushrooms, sugar, and agricultural waste, and have a variety of uses as fossil-fuel input replacements. In an increasingly ESG-conscious market, bio-based materials offer a differentiator as well as an opportunity to capture waste as a resource (Carbon Minus).

These materials often carry a higher upfront investment: a 2024 report by Planet Pristine found that bio-based materials can cost up to 20-30% more than their traditional counterparts, citing natural raw materials and complex production. However, as demand grows and production scales, bio-based inputs are expected to offer greater price stability over the long term. With responsible sourcing and smart integration, bio-based inputs offer a pathway to enhance business resilience.

Leaning into bio-based materials, where multiple inputs (ex. Algae, mushroom, or sugar, all as options for producing a bioplastic) can serve as alternatives to oil-based inputs, can diversify a brand’s material library and help to mitigate risk (Go!PHA).

As supply chain disruptions become more common, brands that rely on a narrow set of inputs face becoming increasingly vulnerable. Not all bio-based materials will be suitable for every product, but building redundancy into a sourcing strategy offers greater flexibility in the face of shifting supply chain dynamics.

Further, bio-based materials open the door to geographically diverse regions or even more localized sourcing (Prism Sustainability Directory). Unlike fossil-derived inputs, which are often concentrated in politically or environmentally volatile regions, many bio-based feedstocks can be cultivated across a range of climates and continents. This flexibility can reduce vulnerability to specific shocks such as regional conflicts, market fluctuations, extreme weather, while also potentially shortening supply chains and increasing transparency.

Bio-based materials can also support closed-loop production. During processing, many are refined through systems that capture and reuse necessary chemicals, significantly reducing water effluent. Further leaning into a closed-loop system, when designed with end-of-life in mind, these materials can often be recovered, remade, or reintegrated into future production. This aligns with circular economy principles, reducing reliance on virgin extraction and minimizing exposure to raw material volatility.

Considerations with Bio-Based

Bio-based inputs are by no means a silver bullet. While bio-based materials are renewable, issues concerning land use and resource consumption must be considered. As the demand for these materials grows, producers must ensure they’re sourced sustainably. Bio-material crops may be grown with pesticides or fertilizer, and require machinery and processing that may run off fossil-fuel based energy sources (Carbon Minus). Depending on the intensity of processing, they may emit more carbon than conventional materials.

Considerations must also be given to performance. Not all bio-based materials are created equally; to each other or to their conventional counterparts. Testing for performance and durability must be considered. Further, biodegradable doesn’t guarantee actual degradation. Most municipalities lack the proper infrastructure for compostable or biodegradable products. Sent to landfill, bio-based materials will not decompose as intended. Rather, just like their conventional counterparts, they will release methane into the atmosphere (Beyond Plastics). Ensuring bio-based materials have a viable end-of-life pathway is critical to avoiding unintended carbon impacts.

Measuring Impact

To confirm a bio-based input is truly a lower-carbon and high-performing alternative to a conventional input, performing a life-cycle assessment (LCA) is necessary. LCAs evaluate environmental impact across the entire lifespan of a product: from raw material extraction to production, use, and end-of-life, helping companies avoid unintended trade-offs (ie. high water use, land degradation, high carbon emissions). Without this analysis, well-intentioned substitutions risk falling short of sustainability goals or inviting greenwashing scrutiny.

Next Steps

The long-term potential for cost stability in bio-based materials is strong, driven by technological innovation, diversified feedstocks, rising demand, and circular economy practices. Supportive policy environments may further accelerate, or even incentivize, material adoption. As the true costs of oil-based inputs are increasingly internalized, including their environmental and social impacts, bio-based alternatives are poised to become not only more competitive, but more resilient over time.

The key to responsible adoption is a systems thinking approach. Sourcing bio-based inputs is only part of the equation; brands must also invest in infrastructure, partnerships, and design strategies that support the responsible use and recovery of these materials. With thoughtful integration, bio-based materials can become a powerful tool, not just for avoiding oil-based inputs, but for building supply chains that are smarter, more adaptive, and fit for the future.