China's 2013 Oil Demand Sees Slowest Rise In At Least 22 Years

Reuters

BEIJING, Jan 20 (Reuters) – China's oil consumption in 2013 posted the slowest rise in more than two decades, data showed on Monday, as softer economic growth sliced into demand for transportation and industrial fuels such as diesel.

While a slowdown in oil consumption by the world's second-largest user was expected, the sluggish rise could pressure global oil prices at a time OPEC member Iran's nuclear deal with world powers is raising the possibility of the Middle Eastern nation being allowed to pump and export more oil.

China's energy appetite has driven global oil demand growth for the past decade as usage slows in industrialized nations. Its slowing demand last year capped prices that would have otherwise soared on the plunge in exports from Iran, prolonged outages in Libya and disruptions in Sudan.

China's implied oil demand rose 1.6 percent in 2013, or 150,000 barrels per day (bpd) on the year, according to Reuters calculations based on preliminary government data. Reuters started calculating implied oil demand from 2005.

But data from the International Energy Agency (IEA) indicates that apparent oil demand has not grown as slowly since at least 1992, although its calculation methods may differ.

"China's oil demand has entered an of era of moderate growth," said an oil analyst with China International Capital Corp (CICC). "Diesel demand was almost flat last year, but gasoline demand kept rapid growth on rosy auto sales."

China's economy narrowly missed expectations for growth to hit 14-year lows in 2013, though some economists say a cool down will be inevitable this year as officials and investors hunker down for difficult reforms.


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