Bota Posted on 2024-12-21 13:30:00

"China's oil consumption to peak in 2027" - Natural gas, electric vehicle expansion weakens demand

From Kristi Ceta

"China's oil consumption to peak in 2027" - Natural gas, electric

China's oil consumption will peak by 2027, according to state-run refining giant Sinopec, as demand begins to weaken in the world's biggest oil importer.

The 2027 peak will reach no more than 800 million metric tons, or 16 million barrels of crude oil per day, Sinopec said. Last year, Sinopec forecast China's demand to peak, also at 800 million tonnes, around mid-2026-2030.

China's energy sector faces new uncertainty in 2025 with the return of President-elect Donald Trump to the White House, raising the possibility of trade tensions and a possible disruption of Iranian oil exports, analysts said. Trump is expected to tighten enforcement of sanctions on Iran, which exports roughly 1.5 million barrels of oil a day, mostly to China and its independent refiners.

Driven by a shift to electric vehicles and an increase in the number of trucks fueled by liquefied natural gas (LNG), the speed of China's move towards peak oil has surprised the industry, with crude imports on track to peak in 2025, experts explain. The peak of 800 million tonnes compares with 750 million tonnes to be consumed in 2024, when demand is on track to fall by about 10 million tonnes from last year, Sinopec said.

With the wider use of natural gas and electric vehicles reducing demand for gasoline and diesel, the petrochemicals sector will consume more oil than the transportation sector, accounting for 55% of oil consumption in 2060, up from 22% in 2024, Sinopec said. Sinopec, Asia's biggest refiner, also said China's natural gas consumption may peak earlier but at a higher level than forecast last year. By 2030, China's gas consumption is expected to reach 570 billion cubic meters (bcm) and rise to about 620 billion cubic meters between 2035 and 2040.

 

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