Sinopec Forecasts Significant Drop in China's Oil Demand Amid EV Adoption
China Petroleum & Chemical Corporation (Sinopec), the world’s largest refiner, predicts an 8.9% decline in oil demand across China by 2026 compared to the previous year. This drop is attributed to higher oil prices and a rapid shift toward electric vehicles (EVs). Gasoline consumption is expected to fall by 8.7%, while diesel use could plummet by 11.4%. The only transportation fuel showing growth will be jet fuel, with demand rising slightly by 1.3% due to increased travel activity. Sinopec's research arm notes that high oil prices have already suppressed some demand and accelerated the adoption of EVs in China. Additionally, Sinopec is adapting its business strategy, planning to shift capital toward new energy and chemicals as domestic fuel sales decline for a second consecutive year. The company has reported falling refined product consumption due to these factors. The firm's first-half earnings highlighted reduced domestic fuel sales impacting profits, signaling the need for strategic transformation in response to changing market dynamics.
Topics: China energy market electric vehicles oil demand Sinopec transformation