Such decrease of the demand for gasoline to a great extent is connected with e-vehicles expansion. According to the Chinese Association of Automotive Manufacturers (CAAM), the sales of e-cars, hybrids and FCEVs (fuel cell electric vehicles) in 2024 grew by 35.5% achieving 12.9 mln vehicles. The share of vehicles using new types of energy sources in the sales profile for all types of cars in the end of the preceding year was 40.9%. Moreover, in December 2024, this share was as high as 45.7% (vs 35.7% YoY).
The glut of e-cars partially is associated with availability of the resources required for energy storage in China. According to the International Energy Agency (IEA), in 2023, the PRC accounted for more than 60% of global supply of the processed lithium, 80% of the processed cobalt and almost 100% of the processed graphite. The fact that China does not have “big history” in the traditional car manufacturing is another factor: it stipulates Chinese companies to generate innovations in the new sectors of transport.
The slowdown of the demand for gasoline in the PRC also is associated with the overall slowdown of Chinese economy. According to the general evaluation of the IMF, the GDP growth in China slowed down from 5.2% in 2023 to 4.8% in 2024, and at the end of 2024 it will be “only” 4.6%. And last but not least, there is such factor as slowdown of the demographic increase: according to the World Bank, the total population in the PRC in 2024 was the same as in 2023 (1,411 mln people), while as in India it grew by 2% (up to 1,429 mln people) over the same period.
De-facto it means that the manufacturers of both traditional cars (internal combustion engine cars) and of e-vehicles are competing for the stagnating market. That is why the e-vehicles expansion leads to decrease of the demand for automotive gasoline and overall slowdown of the demand for oil.
