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Analysts Warn China’s Oil Demand May Never Fully Recover
Crude Oil Prices Today | OilPrice.com • • business
Key Points:
- Analysts predict China’s crude oil imports may remain permanently lower due to demand destruction driven by the electrification of transport, particularly the shift to electric vehicles (EVs).
- Despite a recent decline in EV sales following subsidy cuts, EVs still accounted for 42% of all car sales in China in May, indicating sustained consumer preference for electric transport.
- Rystad Energy estimates China’s oil demand has dropped by 200,000 to 600,000 barrels per day from pre-war levels, with Energy Aspects projecting a permanent loss of 300,000 barrels daily.
- FGE NexantECA forecasts a sharp oil import decline of up to 3.3 million barrels per day this quarter, influenced by factors like lower refinery runs, the end of stockpiling, and Beijing’s fuel export ban boosting domestic supply.
- Some experts, including Kpler, expect Chinese refiners to eventually increase imports again to replenish stockpiles depleted due to war-related price spikes, maintaining strategic oil reserves.
