China's Oil Consumption Falls 9% in Q2 as EVs Displace 36 Million Tons

September 3, 2026 at 10:30 PM2 min

This digest was compiled by AI from multiple sources — links to the originals are below.

China's oil consumption fell 9% year over year in the second quarter as high crude prices accelerated the shift to electric vehicles, trucks, and industrial equipment. The decline helped cut China's carbon dioxide emissions by 1% during the quarter, the first quarterly drop driven primarily by lower oil use. Power-sector emissions rose 3% over the same period as coal-fired generation increased.

Key Facts

China's oil consumption fell 9% year over year in the second quarter, according to an analysis by the Centre for Research on Energy and Clean Air.
Electric vehicles displaced 36 million metric tons of oil during the first half of 2026, accounting for roughly one-third of the reduction in Chinese oil demand.
Alternative-fuel use in China's trucking sector jumped 90% year over year between January and June, reducing diesel consumption.
Lower oil consumption prevented roughly 35 million tons of carbon dioxide emissions during the second quarter, equal to about 1.3% of China's total emissions.
China's carbon dioxide emissions fell 1% in the second quarter, the first quarterly decline driven primarily by lower oil consumption.

EV Displacement

Electric vehicles displaced 19 million tons of oil during the second quarter alone, 50% more than a year earlier. Electric trucks produced the fastest change, with alternative-fuel use in China's trucking sector jumping 90% year over year between January and June. Oil use also fell in construction and mining as electric equipment replaced diesel-powered machinery. Slower growth in China's chemical sector reduced another source of petroleum demand.

Emissions Impact

The decline in oil consumption helped cut China's carbon dioxide emissions by 1% during the second quarter. Power-sector emissions rose 3% during the same period as coal-fired generation increased. CREA estimates lower oil consumption prevented roughly 35 million tons of carbon dioxide emissions during the second quarter, equal to about 1.3% of China's total emissions. The calculation includes emissions associated with electricity used to charge EVs.

Market Context

Oil got more expensive after the Iran war disrupted Persian Gulf supply and traffic through Hormuz. China cut crude imports and drew more heavily from inventories. China remains the world's largest crude importer, giving changes in its transportation fleet consequences well beyond its emissions numbers. CREA expects Chinese emissions could fall for the full year as oil demand weakens, property activity remains subdued, and coal-to-chemicals production runs near capacity.