US Tariffs, Iran Policy Could Hit China’s Oil Demand

Steep new US tariffs on China floated by President-elect Donald Trump, if enacted, could hit the Asian giant’s already challenged economy and further erode its tepid oil demand growth. China is already importing a growing proportion of non-crude liquids like LPG in response to domestic market trends, and these products could get ensnared in any trade war. Other Trump foreign policies, including promises to tighten the screws on Iran and its oil sector — an increasingly important Chinese supplier — could also impact imports in 2025 for China, an economy that has been the engine of global growth for two decades. China’s oil demand growth is shaping up to be less than 100,000 barrels per day this year, Energy Intelligence estimates, capped by weakening economic growth and peak demand for gasoline and diesel. The peak in Chinese demand is increasingly visible — state China National Petroleum Corp. (CNPC) now expects the country’s oil demand to peak in 2025, five years earlier than its previous forecast. CNPC’s Economics and Technology Research Institute sees demand topping out at 770 million tons (15.5 million b/d) in 2025. Both CNPC and state refiner Sinopec have said Chinese demand for gasoline, diesel and jet fuel peaked in 2023.