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China's fuel consumption may have reached its peak, the IEA reports

The International Energy Agency (IEA), which released data on Thursday showing that China's road and air transportation fuels have likely reached their peak, said the agency. Data showed that China's consumption for gasoline, jet fuel and gasoil had decreased marginally by 2024.

In a report published monthly, the IEA stated that the combined consumption of three fuels was 8.1 million barrels a day in China in 2018. This was 200,000 bpd less than 2021 levels and was only marginally higher than 2019 levels.

It said that "this strongly suggests fuel consumption in the country has reached a plateau, and may have even passed its peak."

China's oil demand contribution has slowed down after decades of being the leader in global growth. It is now facing economic challenges and is also shifting to electric vehicles.

According to the Paris-based IEA, the decline in China's oil demand will accelerate in the medium term. This would be sufficient to create a plateau for China's total oil demand in this decade.

The IEA stated that "this remarkable slowdown in the consumption growth was achieved through a combination structural changes in China’s economy and rapid deployment of alternative transport technologies."

It said that a slump in China's building sector and weaker spending by consumers reduced fuel consumption in the country. The uptake of EVs was also a factor.

It said that new EVs account for around half of all car sales. They will reduce oil demand by around 250,000 to 300,000 bpd in 2024. The use of compressed natural gas and liquified gas in road freight is expected to displace around 150,000 bpd. Enes Tunagur is reporting, Alex Lawler is editing and Tomaszjanowski is directing.

(source: Reuters)