Global oil demand growth experienced a slowdown in the second quarter of 2024, driven primarily by reduced construction and industrial activities in China, according to the International Energy Agency (IEA).
In its monthly oil report released on Tuesday, the IEA highlighted that global oil demand is projected to increase by less than 1 million barrels per day (mbd) in both 2024 and 2025. This growth rate is notably lower than last year’s 2.1 mbd rise and the expansion rates seen before the COVID-19 pandemic.
The IEA estimates that global oil consumption will reach 103.06 mbd in 2024, up from 102.09 mbd in 2023 and 100.6 mbd in 2019.
However, Europe is expected to see a decline in overall demand, with only marginal increases in the Americas. In contrast, demand is anticipated to continue growing in the Asia-Pacific region, particularly in China.
Despite this, the report points out that Chinese oil demand has decreased for three consecutive months, largely due to weaker demand for gasoil (diesel) and naphtha—key fuels for the construction and manufacturing sectors.
The IEA also noted that the growing number of trucks powered by natural gas or electric batteries is reducing the demand for diesel.
The Paris-based agency, which advises oil-consuming nations on energy policy, emphasized that the slowdown in China’s construction and manufacturing sectors, alongside the rapid adoption of alternative fuel vehicles, has contributed to this downward trend.
Additionally, electric vehicle sales in China have been robust, with data from the China Passenger Car Association indicating that over 50 percent of car sales in July were electric, marking a significant increase in the first half of the year.