China’s largest refiner forecasts peak oil demand in 2023, easing import needs and pressuring prices amid Middle East supply risks.
Oil prices extended declines, dropping over 2% in recent sessions, as China’s refinery sector signaled peak demand in 2023. The country’s largest refiner expects crude processing and imports to plateau, reducing global demand growth prospects.
Weaker-than-expected US sanctions on Iran and limited tanker disruptions in the Strait of Hormuz failed to offset bearish sentiment. Analysts warn that if Middle East supplies normalize, softer Chinese demand could tip the market into oversupply.
Prices fell despite Kpler data showing only two tankers transited the Strait of Hormuz yesterday, the lowest since early May. A slight demand recovery is possible in 2025 if US-Iran tensions ease, but levels are unlikely to match 2023 peaks.