Following the country’s reopening, China is anticipated to contribute for approximately 40% of the growth in worldwide oil demand this year, according to the natural resources consultancy on Thursday. However, the increase is unlikely to bring prices back to levels seen in 2022.
With the lifting of the stringent Covid-19 restriction, in a base-case scenario, the Chinese economy is expected to rise by 5.5% this year, according to a forecast by Wood Mackenzie. This would amount to one million barrels of oil per day (bpd) of the 2.6 million bpd increase in oil demand expected worldwide in 2023.
A high-growth scenario, if China’s growth expands by 7%, would add a further 400,000 bpd of Chinese demand, the report said.
According to Wood Mackenzie, the average price of Brent crude oil this year will remain lower than the US$99/bbl average anticipated for 2022, since markets have already responded to the disruption caused by Russia’s invasion on Ukraine.
