China's oil demand growth to slow to around 4% in 2012 - consultant
12 September 2012 10:16 [Source: ICIS news]
SINGAPORE (ICIS)--Oil demand in ?xml:namespace>China is expected to slow down in 2012 as a result of an expected contraction in its economic growth except for consumption by transport sector on the back of rising vehicle sales, an industry consultant said on Wednesday.
On a year-on-year basis, China's oil demand growth is expected at around 4% this year, compared with the close to 6% growth seen in 2011, said Sushant Gupta, head of consultancy firm Wood Mackenzie's Asia Pacific Research team.
Gupta was speaking at the annual Asia Pacific Petroleum Conference (APPEC) in Singapore which runs from 11-13 September.
"We expect oil demand to rebound in 2013 from stronger GDP growth," he said, adding the China's year-on-year oil demand growth next year is expected to rise to close to 6%.
This is still a sharp drop from the year-on-year oil demand growth of 12% in 2010, according to Gupta.
"We don't expect a hard landing in China as a result of the challenges in export markets because of increasing domestic income and consumption as well as strong car sales," he said, referring to China's oil demand growth.
"The growth in inland infrastructure projects and the start-up of new ethylene plants will also boost demand for naphtha, which will in turn increase the demand for crude," Gupta added.
However, while oil demand growth has slowed down in China, the trends vary among the different oil products, with relatively less impact on transportation fuels, Gupta said.
Demand growth for gasoline in China is expected at close to 10% this year, up from about 6% last year, fuelled by the growth in vehicle sales, he said.
Demand growth for fuel oil in China is expected to dip to about 1% this year from around 4% in 2011, because of the growing use of gas and coal substitutes, according to Gupta.By: Nurluqman Suratman
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial
to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free
trial to ICIS Chemical Business.