China’s oil demand probably peaked last year, earlier than previous estimates, according to the head of the nation’s top refiner.
Clean energy development, electrification and low-carbon goals mean that the country’s oil demand has probably already crested, Sinopec Chairman Hou Qijun said Monday at an earnings briefing in Hong Kong. The company had previously forecast usage to top out in 2027, while the government is targeting oil and coal consumption to reach their limits during the current five-year plan period, which runs through 2030.
“Next year, even if the US-Iran conflict eases up, things might recover, but it won’t hit last year’s level,” Hou said. “So it’s very likely demand peaked last year.”
China is the world’s largest oil importer. An earlier start to reducing consumption would help rein in its world-leading emissions while raising questions for the world’s top crude drillers.
Sinopec, known officially as China Petroleum & Chemical Corp., said in its earnings report on Sunday that road fuel demand plummeted in the first half as consumers shied away from higher prices and shifted to electric vehicles. The declines are expected to narrow a bit in the second half because of supportive economic policies, said Tian Hongbin, a senior vice president at the company.
Even as fuel demand drops, the company is making sure domestic supply needs are met, President Wan Tao said during Monday’s briefing. It’s diversifying crude sources away from the Middle East while working with its suppliers in the region on shipping routes safe from the violence of the Iran War. The refiner has received 11 oil tankers previously stuck in the Persion Gulf that were carrying a combined 2.76 million tons of crude, he said.
The company typically keeps about 20 days of crude storage for refining purposes, and 15 days of refined products for marketing, Wan said. Inventory levels have remained steady during the war, and Sinopec will continue to follow directions from the government on its commercial storage levels, he said.
source: Sinopec Says China Oil Demand ‘Very Likely’ Peaked in 2025 | Rigzone