China’s oil demand growth may slow “noticeably” this year as the economy expands at a reduced pace and the country improves energy efficiency, according to the International Energy Agency.
China, which consumes more oil than any country except the U.S., may boost efficiency as it burns more natural gas and restricts car use, according to the energy security adviser to the Organization for Economic Cooperation and Development. Fuel demand may increase 6 percent this year, from 12 percent in 2010, the IEA said today in its monthly Oil Market Report.
“The economy should cool down slightly, gasoil shortages ease and oil intensity fall,” the Paris-based agency said. “New sources of energy should provide some degree of inter-fuel substitution.”
Crude futures in New York have rallied 17 percent in the past year as emerging economies including China led a global economic recovery. The IEA estimated the country’s fuel demand was 9.39 million barrels a day in 2010, up 0.6 percent from the 9.34 million forecast in its previous report Jan. 18. This year’s consumption may rise to 9.96 million, the agency said.
Gross domestic product in China may expand 9.5 percent this year, compared with about 10 percent in 2010, according to the median estimate of economists surveyed by Bloomberg. Government measures to curb auto sales in the country, the world’s largest car market, will further slow oil demand growth, according to the IEA. Beijing had 306,865 applications for February’s lottery of 20,000 new license plates for private cars, the official Xinhua News agency said yesterday.
“China’s oil demand outlook has become increasingly crucial for global oil balances,” the IEA said. “We remain cautious so far, expecting China’s oil demand to rise by a much more modest but nonetheless significant 570,000 barrels a day.”
Source: http://www.bloomberg.com
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