Oil demand to hit close to 2019 level

More road, flight trips to catalyze domestic need for transportation fuel this year after 3 years of declines

Demand for oil products in China will recover gradually this year from the impact of the COVID-19 outbreak, a think tank has said, with the full-year volume expected to be around 400 million metric tons, close to the level seen in 2019.

Transport oil demand in 2023 is expected to increase by 9.3 percent year-on-year and recover to that of the pre-pandemic level, said Wang Lining, director at the Oil Market Research Department of the Economics and Technology Research Institute of China National Petroleum Corp, during the release of a report in Beijing recently.

With the annual road travel index of residents expected to grow by 25 percent and the air travel index by 50 percent this year, gasoline demand in China will be 0.8 percent higher than that in 2019 and demand for diesel and kerosene will be around 98.8 percent and 95 percent of the 2019 level, respectively, he said.

COVID-19 has substantially impacted both oil supply and demand.

Last year, China's oil demand fell for the first time since 1991 and demand for transport fuel experienced a historic negative growth from 2020 to 2022 due to the virus outbreak, he said.

According to the institute, China's crude oil supply has been growing steadily so far this year, with production reaching 87.7 million tons during the first five months, up 2.3 percent year-on-year. It is estimated that annual crude oil production will remain above 200 million tons, it said.

Crude oil imports, meanwhile, rose to 230 million tons, up 6.2 percent year-on-year. Crude oil import for the whole year is expected to touch 540 million tons, close to the historical peak in 2020.