China's 2023 crude oil demand is expected to grow less than previously expected, as strong demand for electric vehicles weighs on gasoline demand, an expert at China National Petroleum Corp.'s (CNPC) research arm said on June 20.
The state oil company's Economic & Technology Research Institute (ETRI) in March forecast oil demand reaching 743 MMmt this year for the world's top crude importer. This is equivalent to around 14.86 MMbbl/d.
But speaking at an event in Beijing, Wang Lining, head of markets at ETRI, said growth would come in below original forecasts this year, with oil demand reaching 740 MMton, or about 14.80 MMbbl/d.
"The main reason, I think, is that the replacement of cars this year is relatively large," Wang told Reuters on the sidelines of the event.
China is the world's largest market for electric vehicles. Sales rose 10.5% in May versus the month before, accounting for a third of total car sales, according to the China Passenger Car Association (CPCA).
Demand is set to grow further, with Beijing issuing new measures to promote EV purchases.
The International Energy Agency also said earlier this month that strong demand for EVs would curb oil demand growth.
China's gasoline demand will grow by 0.8% this year from 2019 levels before peaking in 2025, according to ETRI forecasts.
Disappointing economic data also contributed to the smaller growth forecast, added Wang.
Several major banks have cut their 2023 economic growth forecasts for China this month amid concerns its post-COVID recovery is faltering.
Wang also said demand for both diesel and kerosene would not reach 2019 levels this year.
Recommended Reading
Permian Gas Finds Another Way to Asia
2024-04-30 - A crop of Mexican LNG facilities in development will connect U.S. producers to high-demand markets while avoiding the Panama Canal.
Segrist: The LNG Pause and a Big, Dumb Question
2024-04-25 - In trying to understand the White House’s decision to pause LNG export permits and wondering if it’s just a red herring, one big, dumb question must be asked.
Silver Linings in Biden’s LNG Policy
2024-03-12 - In the near term, the pause on new non-FTA approvals could lift some pressure of an already strained supply chain, lower both equipment and labor expenses and ease some cost inflation.
Texas LNG Export Plant Signs Additional Offtake Deal With EQT
2024-04-23 - Glenfarne Group LLC's proposed Texas LNG export plant in Brownsville has signed an additional tolling agreement with EQT Corp. to provide natural gas liquefaction services of an additional 1.5 mtpa over 20 years.
White House Open to Ending LNG Export Pause in Push for Ukraine Aid, Sources Say
2024-04-02 - Reversing the pause could be tolerable to the White House in order to advance Ukraine aid, in part because the pause has no bearing on near-term LNG exports, the White House sources said.