China's extremely rapid adoption of EVs has forced oil giant Sinopec to adjust its forecasts, saying peak domestic gasoline demand has already passed and it's all downhill from here. The repercussions will be global; China has been the biggest growth market for refined oil products for more than 20 years.
According to CNEV Post, Chinese new car buyers are now choosing "new energy vehicles" (NEVs, meaning battery-electric and plug-in hybrid cars) at a rate of 37.8%, a percentage which has rocketed up from 30.0% in 2022, 15.5% in 2021 and just 5.4% in 2020.
While Scandinavian countries like Norway (87.8%), Iceland (56.1%) and Sweden (56.1%) led the world for EV adoption in 2022, China sells somewhere around 10 times more EVs than all those three combined, and there's a lot more room for growth in the world's second-most populous country, since as of 2022, less than 5% of cars on Chinese roads were NEVs.
So China's largest oil company Sinopec is already seeing a drop in demand, from which it doesn't expect to recover. Previous predictions placed peak demand somewhere in 2025, but at a conference in Zhengzhou in August, Bloomberg reported that one Zhou Yan, from Sinpoec's retail sales division, said EVs were already displacing some 15 million tons of Chinese oil product sales in 2023, and that the company is forecasting that 2024 and subsequent years will see declining demand.