China’s Carbon Pollution Fell in Recent Months as Oil Demand Plummeted

China’s carbon pollution fell modestly in recent months after the country’s consumers and industries sharply cut their use of oil, according to a new analysis. With oil and gas markets still in turmoil due to war in the Middle East, the trend could translate into a full-year decline for China’s carbon dioxide emissions.

After the United States and Israeli bombing of Iran prompted the closure of the Strait of Hormuz, China responded by slashing its oil imports.

But because China had built massive stockpiles of crude, the big question was whether the country was simply drawing down its reserves or actually using less oil.

New government data now reveals that China’s oil consumption dropped by 9 percent from April through June, with use in the transportation sector plummeting by 16 percent, according to an analysis by the Centre for Research on Energy and Clean Air, an independent research organization based in Finland.

That decline helped overshadow an uptick in coal consumption to push carbon dioxide emissions down by 1 percent from the same period last year. The trend helped hold China’s CO2 pollution slightly below its 2024 peak.

It also helped push global oil demand down in what is projected to be the first annual decline since the COVID-19 pandemic forced global lockdowns, according to the International Energy Agency. Consumption in the United States was flat, according to the U.S. Energy Information Administration.

While several factors contributed to China’s drop, the most important was the rapid electrification of its cars, trucks and buses.

“What’s very clear is that electric vehicle sales have been on a tear,” said Lauri Myllyvirta, lead analyst at the center behind the report.

If the trend can hold, it could reshape global energy dynamics. China’s growing appetite for crude has been a defining feature of the global oil market over the last decade, expanding by more than 500,000 barrels of oil per day annually on average. China is the world’s second-largest oil consumer, behind the United States, and its largest importer.

But growth in the country’s oil consumption has slowed in recent years. Already, oil use for transportation has peaked and begun to decline, driven by the rise of electric vehicles.

The decline in oil use in China over the first half of this year was greater than the amount of oil used in the United Kingdom over the same period.

— Centre for Research on Energy and Clean Air report

The new data shows this trend has accelerated. Electric truck sales surged by 77 percent in the second quarter compared to the previous year, the report said, while the total number of EVs was 33 percent higher than a year earlier.

And government charging data indicates that people and businesses also used their EVs more in recent months, favoring electric transportation over gas and diesel fleets. One possibility is that people used electric taxis, which have proliferated in China and become cheaper, rather than driving their own gas cars, the report said. Public transportation use was up, too.

Still, Myllyvirta said the decline in oil use was greater than what would be expected simply by the rise in EVs, suggesting people and businesses are changing their behavior in other ways.

“There are things that you can pin down and then there are things that are just left as a residual, because there isn’t a good way to track them,” Myllyvirta said.

All told, the decline in oil use in China over the first half of this year was greater than the amount of oil used in the United Kingdom over the same period, the report said.

The decline is consistent with a broader structural shift in China’s economy toward electrification and higher use of renewable energy driven by government policies, said Tim Himle Levinh, a senior analyst for carbon and energy systems at the research firm Rystad Energy, in an email. Rystad expects China’s climate emissions are approaching a peak.

The emissions decline would have been larger if not for a 2.4 percent increase in burning coal for power. China continues to build new coal power plants even as it rapidly expands wind, solar and nuclear energy production. The report said that despite this increase in emissions-free power, grid operators often chose coal over renewables because of transmission limits and incentives that favor burning the fossil fuel.

One surprise from the data, Myllyvirta said, was that coal use to produce chemicals or synthetic fuels actually declined in recent months, despite some analysts speculating the opposite would occur.

Levinh said that while he expects China’s oil use to trend downward, higher consumption for petrochemicals, planes and other sectors could lead to increases in some years. An end to the conflict in the Middle East, analysts say, will likely lead to a rebound in oil use both in China and globally.

But some of the shift underway in China is structural and likely to last, Myllyvirta said. The share of EVs will continue to grow, he said, and businesses are also redesigning their processes and supply chains to use less oil. All of that is likely to continue even if markets return to normal.

Nicholas Kusnetz

Reporter, New York

Nicholas Kusnetz is a reporter for Inside Climate News. Before joining ICN, he worked at the Center for Public Integrity and ProPublica. His work has won numerous awards and citations, including from the Society of Professional Journalists, the Society of Environmental Journalists, the Overseas Press Club, the Society of American Business Editors and Writers and others. His articles have appeared in more than a dozen publications including Wired, The Washington Post, Businessweek, The Nation and The New York Times. Nicholas can be reached on Signal at nkusnetz.15.

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