Weaker Demand Ahead: China's Oil and Gas Market Faces Headwinds

China's demand for oil and gas is expected to weaken in 2026 due to high crude oil prices, lower economic activity, and an accelerated shift towards alternative energy sources.

According to analysts at BMI, a Fitch Solutions unit, the outlook for the Chinese energy market has deteriorated this year. The evolution of crude oil imports and domestic consumption reflects the pressures affecting both refineries and major fuels.

China's crude oil imports remained under pressure in 2026, with an average forecast of $86 per barrel for Brent Dated and $83 per barrel for Brent futures. Analysts project a price of $71 per barrel for both in 2027.

The demand for oil and gas is losing momentum in China, with gasoline and diesel consumption falling by 8.6% year-on-year during the first half of 2026. Diesel saw the largest contraction, with a drop of 11.5%, while consumption of gasoline decreased by 7.9% compared to the same period of the previous year.