China's EVs are fueling a big oil demand slowdown

Kelly Cloonan

Aug 21, 2024, 4:19 AM GMT+10

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Workers are producing a BYD new energy commercial vehicle at a workshop in Huai'an, China, on January 11, 2024.Costfoto/NurPhoto/Getty Images

• China's oil demand growth has slowed this year.
• That's due to China's big shift to EVs and natural gas, Goldman Sachs analysts said.
• The country's economy is seeing a slowdown across the board.

Oil demand in China has slowed markedly this year amid the country's shift to electric vehicles and natural gas, Goldman Sachs analysts said.

The firm estimates that oil demand growth in the country is down to 200,000 barrels per day for 2024 compared to last year, with overall consumption down by 300,000 barrels a day.

The shift from gas-fueled cars to electric and hybrid vehicles alone has reduced demand by 500,000 barrels a day, the analysts said.

China's EV sector has expanded rapidly, with three of its biggest electric car makershitting record sales in June. Areportfrom last month finds Chinese EV companies are catching up to — and even beating — industry leader Tesla when it comes to innovation.