BEIJING: China’s oil consumption in 2013 posted the slowest rise in more than two decades, data showed yesterday, as softer economic growth sliced into demand for transportation and industrial fuels such as diesel.
While a slowdown in oil consumption by the world’s second-largest user was expected, the sluggish rise could pressure global oil prices at a time Opec member Iran’s nuclear deal with world powers is raising the possibility of the Middle Eastern nation being allowed to pump and export more oil.
China’s energy appetite has driven global oil demand growth for the past decade as usage slows in industrialised nations. Its slowing demand last year capped prices that would have otherwise soared on the plunge in exports from Iran, prolonged outages in Libya and disruptions in Sudan.
China’s implied oil demand rose 1.6 percent in 2013, or 150,000 barrels per day (b/d) on the year, according to Reuters calculations based on preliminary government data and unrevised 2012 figures.
Reuters started calculating implied oil demand from 2005. Waning momentum capped China’s annual economic growth at a six-month low of 7.7 percent in the October-December quarter, a slowdown some analysts say may deepen this year as China endures the short-term pain of revamping its growth model for the long-term good.
“China’s oil demand has entered an era of moderate growth,” said an oil analyst with China International Capital Corp (CICC). “Diesel demand was almost flat last year, but gasoline demand kept rapid growth on rosy auto sales.”
The 1.6 percent growth in oil demand lagged a forecast by the International Energy Agency (IEA) for 2013 growth at 3.8 percent. The figure was in line with a forecast by the country’s top oil firm China National Petroleum Corporation (CNPC), which last week pegged 2013 oil demand at 1.7 percent.
CNPC has forecast China’s oil demand growing 4 percent this year, with demand for gasoline being the main factor. Implied oil demand in December was 10.06m b/d, down 7.5 percent from a record high 10.88m b/d a year earlier, but up 1.2 percent from November’s 9.94m b/d. Full-year consumption was 9.78m b/d.
Implied demand is a combination of crude oil throughput and net imports of refined oil products. It also does not adjust for stocks changes, which are seldom disclosed by the government. In its December report, the IEA estimated Chinese oil demand at 10.19m b/d in 2013, up 370,000 b/d from 2012. The agency has forecast similar, modest growth for this year at 3.7 percent to 10.57m b/d.
Reuters
