China, the world’s leading oil consumer, has officially reached its peak oil consumption. According to the CNPC’s Economics & Technology Research Institute, the nation's refined oil usage peaked in 2023 at 399 million metric tons (approximately 8 million barrels per day) and is projected to decline by 1.3% in 2024.
This development is significant for an economy that has been a major driver of global oil demand for many years.
Several factors contribute to this shift, particularly the rise of electric vehicles (EVs) on Chinese roads. By 2035, it is anticipated that half of the country’s car fleet will be composed of EVs, leading some experts to predict a substantial reduction in gasoline and diesel demand—potentially by as much as 50% from 2023 levels, if CNPC’s forecasts hold true.
In contrast, jet fuel demand is expected to grow by 70%, driven by a booming aviation sector.
What does this mean for crude oil imports? They are also expected to decline, with projections indicating that China’s crude oil imports will fall to 544 million tons in 2024, raising questions about the country’s role as the global oil market’s growth engine.
Despite this decrease in demand growth, China still represents a significant quarter of global crude imports. Looking ahead, CNPC forecasts a 25-40% reduction in overall refined product consumption by 2035. However, not all is negative for the oil industry; demand for petrochemical feedstocks, such as naphtha and LPG, is predicted to increase by 55%, driven by the growth of China’s plastics and chemical sectors.
This marks a significant evolution, signaling to crude oil producers the need for adaptation and innovation.
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