Use of oil in transport sector ‘set to peak next year’
Oil consumption in China’s transport sector will peak next year “at the latest” as rapid adoption of electric vehicles by drivers pulls the plug on petrol consumption, according to PetroChina, the nation’s largest oil and gas producer.
Overall domestic demand for oil will rise by only 1 per cent year on year this year to 764 million tonnes, compared with 11 per cent growth last year, according to the state-owned company.
Although oil consumption would continue to grow in other sectors such as petrochemicals, the industry had to seek new business models and breakthroughs amid the global cleanenergy transition, an executive said yesterday.
“We believe China’s oil consumption will reach its peak before 2030 at 780 million to 800 million tonnes per year,” said Wu Mouyuan, vice-president at the CNPC Economics & Technology Research Institute, a research arm of state energy giant China National Petroleum Corporation, the parent of PetroChina.
“From 2031 to 2050, oil will no longer be consumed as a transportation fuel, but converted into a feedstock for chemical production,” he said in Hong Kong, where the company released a report on the development of the oil and gas industry.
China’s consumption of oil would continue to decline after 2031, dropping to 200 million to 250 million tonnes per year after 2050, as the country made strides towards nationwide net-zero carbon emissions by 2060, he estimated.
Wu’s comments came as a rapid transformation is sweeping through the energy sector in China and the rest of the world.
Fossil fuels accounted for less than 80 per cent of global energy consumption for the first time last year, data from the International Energy Agency showed. Meanwhile, investments in clean energy exceeded US$1.7 trillion, compared with US$1.1 trillion for fossil-fuel energy.
In China, new-energy vehicles – which comprise plug-in hybrid vehicles, pure battery cars, and fuel-cell vehicles – accounted for 31.6 per cent of new-car sales last year, at 9.5 million units, data from the China Association of Automobile Manufacturers showed.
By 2030, new-energy vehicles were expected to hit 50 per cent of new car sales in China, the world’s largest electric-vehicle market, Moody’s forecast.
Seeking to address investor concerns over oil consumption amid China’s electric-car boom, Wu said new-energy vehicles still presented opportunities.
“Our statistics show each newenergy vehicle uses at least 100 kilograms more plastic than a traditional fossil-fuel-powered vehicle,” Wu said.
“To manufacture lighterweight cars in the future, the use of more plastics is required to replace metals, and that relies on oil for the production of plastics.”
PetroChina saw opportunities in the use of oil to make highvalue chemical products and new materials in future, as well as in becoming an integrated energy provider by combining its capabilities in renewable energy and hydrogen and carbon capture and storage technologies, the company said yesterday.
“PetroChina’s goal is to become China’s second-largest hydrogen company after Sinopec,” Wu said, referring to China Petroleum & Chemical Corporation, the country’s largest oil refiner and petrochemical producer.