LAUNCESTON, Australia, March 20 (Reuters) – As China remains the world’s largest crude oil importer, the question arises: are forecasts for its oil demand growth accurate, or do they overlook the reality of ongoing weakness in imports?
Both the International Energy Agency (IEA) and the Organization of the Petroleum Exporting Countries (OPEC) have made projections about oil demand in China, but these forecasts appear increasingly disconnected from the actual data on imports.
In its latest market report, OPEC predicted China’s oil demand would rise to 16.68 million barrels per day (bpd) in 2024, an increase of 320,000 bpd from the previous year. However, China’s oil imports, according to customs data, have not followed the same trend. Imports in 2024 were 11.04 million bpd, down 2.1% or 210,000 bpd compared to 2023.
Demand figures, however, include more than just crude imports; they also account for domestic production, refined product imports, and changes in inventories. Even with these other components, the weak import data cannot be offset by the other demand factors.
China’s imports of refined oil products were 1.05 million bpd in 2024, which reflects a 1.0% decrease from the previous year. Domestic crude production rose by 1.4% to 4.24 million bpd in 2024, an increase of 60,000 bpd from 2023.
Although China doesn’t disclose changes in its oil inventories, estimates show the country added roughly 1.15 million bpd to its stockpiles in 2024, up from 760,000 bpd in 2023.
Given this data, it’s clear that while China’s oil imports were weak, domestic production showed a modest increase, suggesting that the country may be building up its crude inventories. However, forecasts for China’s oil demand are not necessarily an accurate reflection of the situation.
OPEC’s predicted 320,000 bpd increase in China’s oil demand in 2024 would suggest strong demand for crude. Yet, global oil prices struggled last year, with Brent crude futures dropping from $91.05 per barrel in April 2024 to as low as $68.68 by September, closing the year at $74.64. This price movement shows that despite forecasts of strong demand from China, crude prices were under pressure.
While China’s role in the global oil market is significant—accounting for about one-quarter of global seaborne imports—it is not the sole driver of crude prices. The IEA’s forecast for 2024 is more conservative than OPEC’s, predicting a growth in oil product demand of 151,000 bpd, with a further gain of 228,000 bpd in 2025. OPEC, on the other hand, expects a rise of 310,000 bpd in 2025.
Despite these positive forecasts, actual data continues to show weak crude imports. In the first two months of 2025, China’s crude imports were 10.42 million bpd, a 3.4% drop from the same period in 2024.
Although lower crude prices and potential economic recovery could boost China’s crude imports later in 2025, the current data raises doubts about the accuracy of the IEA and OPEC’s optimistic demand projections.
These contrasting figures highlight the ongoing challenge of accurately predicting China’s oil demand in an environment of declining imports.
Related Topics:
- Traders Eager to Reenter Russian Crude Market, But the Door Remains Closed
- Oil Prices Rise Due to Venezuela Tariffs
- Iraq Gives BP Final Approval for Kirkuk Oil Development