China’s falling emissions amid Iran war spark hope of decarbonisation watershed
Oil consumption plummets and EV sales soar as analysts say demand may not fully return even if crude price falls
TL;DR
- China's CO2 emissions fell by 1% after the US-Israeli war on Iran.
- The reduction was driven by a sharp decrease in oil consumption and an increase in electric vehicle and public transport use.
- China cut oil imports by 32% in the second quarter, equivalent to about a million barrels a day.
- About two-thirds of the import fall came from strategic oil stockpiles, with the remaining third from reduced demand.
- Overall oil use fell by 9%, with transport oil use down by 16%.
- The shift towards electric vehicles has been accelerating, with China being a major manufacturer and user of EVs and related technologies.
- This trend has strengthened the strategic imperative to reduce oil dependence.
- Analysts predict that much of the reduced oil demand may not return, even if global oil prices decrease.
- This is the first time China's overall emissions have fallen due to a reduction in oil use, rather than coal consumption.
- Coal generation rose during the quarter, but observers believe the long-term trend is away from fossil fuels.