Save for later Print Download Share LinkedIn Twitter A month after China scrapped most of its Covid-19 restrictions, the country’s oil demand already appears on the mend, adding some bullish vibes to the bearish sentiment that has governed oil markets so far in 2023. Jet fuel demand will benefit the most, especially after China reopened its international borders on Sunday. A rebound in gasoline demand risks delaying peak consumption of that fuel, even as sales of electric vehicles (EV) are expected to remain vibrant in 2023. Forecasts that China's oil demand would recover in the second quarter, after a fresh wave of Covid-19 ripped through the country, are being brought forward as rising subway trips and increased congestion in Beijing and other major cities indicate that cases may have peaked in large urban hubs. China’s 40-day peak travel period around the Lunar New Year celebration, which falls on Jan. 22, will see 2.1 billion trips by air, land and water, China’s Ministry for Transport forecasts. That would be twice the number of trips last year — but still only 70% of 2019 levels. “Independent refineries’ gasoline sales to output ratio recovered to around 150% last weekend," says an analyst with a Chinese domestic consultancy. In less than two months, analysts at Energy Aspects have revised forecasts for China’s first quarter oil demand twice, from initial expectations for a small decline to 1% year-on-year growth when restrictions were first lifted in December, to 2% growth this month as mobility started increasing.
