The IEA now expects China's gasoline demand to peak in 2024, bringing forward previous forecasts of demand leveling off in 2025/2026.
China's dependence on oil is continuing to decline, as sales of electric vehicles (EVs) that don't require refueling continue to grow rapidly.
China's demand for gasoline could peak as early as next year as sales of EVs soar, a Reuters report said today, citing several analysts.
The International Energy Agency (IEA) now expects China's gasoline demand to peak at about 3.7 million barrels per day (bpd) in 2024, bringing forward previous forecasts that demand would level off in 2025/2026, according to the report.
Peak production is expected to reach 3.7 million bpd, but as early as the first quarter of 2024, compared with previous forecasts of 2024-2025, said Mukesh Sahdev, senior vice president and head of downstream/oil trading at Rystad Energy.
In contrast, Chinese state-owned giants PetroChina and Sinopec expect peak gasoline demand in China to come in 2025.
Demand for refined products will peak in China around 2025, and global oil demand will peak by 2030, Sinopec chairman Ma Yongsheng told a forum in Beijing on July 22.
This requires the petrochemical industry to take the initiative to cope with changes and accelerate the pace of transformation, Ma said.
Behind this change is the rapid development of China's EV industry, while sales of traditional fuel vehicles are stopping growing.
In the first half of the year, China sold 3.75 million NEVs (NEVs), including plug-in hybrids as well as zero-emission battery-electric vehicles, up 44.54 percent year-on-year, contributing 28 percent of all vehicle sales of 13.24 million units, according to the China Association of Automobile Manufacturers (CAAM).
For comparison, China's vehicle sales excluding NEVs were 9.49 million in the first half of the year, basically flat from 9.45 million in the same period last year.
Chen Shihua, deputy secretary-general of the CAAM, said at a July 13 forum that China's NEV sales are expected to reach 9 million units this year.
Oil giants have been preparing for this change for the past several years.
On April 15, 2021, Chinese EV maker Nio (NYSE: NIO) signed a strategic cooperation agreement with Sinopec to build charging and battery swap infrastructure.
Sinopec was accelerating its transformation into a comprehensive energy service provider, with plans to have 5,000 charging and battery swap stations by 2025, said Zhang Yuchuo, Sinopec's chairman at the time.
On April 15 this year, the second anniversary of their partnership, Nio said it had built more than 100 battery swap stations with Sinopec.
In addition to Sinopec, Nio has also partnered with two other Chinese oil giants, China National Petroleum Corp (CNPC) and China National Offshore Oil Corporation (CNOOC), as well as Shell, the world's largest gasoline retailer.
On July 17, Rising Auto, the EV unit of SAIC Motor Corp, announced plans to add more than 50 battery swap stations by the end of the year, saying it would work with Sinopec and CNPC to build battery swap stations.
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