China's Oil Demand Outlook

Transcription

1 China's Oil Demand Outlook Qian Xingkun CNPC Economics & Technology Research Institute Singapore 1

2 1. Lower Growth Rate, Intensity and Elasticity of China s Oil Demand since 2000 China s Oil Consumption Characteristics from Singapore 01 2

3 2. China s Economic Development Goals in the 13th Five Year Plan Economic growth According to the government's development goals, China will complete the building of a moderately prosperous society in all respects in 2020, maintain the economic growth target of 6.5%~7% and accomplish per capita income exceeding ten thousand dollars. Economic structure Basically achieving new industrialization and initally completing the upgrading of Industry 2.0 to Industry 3.0 by 2020; accelerating the development of the service sector, and expecting the proportion of service sector in GDP to raise up to at least 55% by Urbaniza -tion Carrying out a new type of people-centered urbanization; promoting the household registration system, residence permit and land transfer regulations; achieving high quality of urbanization standard, i.e. resident population urbanizaton rate and registered population urbanization rate reach 60% and 45% respectively Singapore 02 3

4 2. Scenario:China s Economic Growth in the New Normal BAU Scenario High-growth Scenario China s average annual GDP growth rate in will be 6.5%. By 2020, GDP per capita will exceed US$10,000. New-type industrialization will be realized, and service sector will account for over 55%, the proportion of industry sector will decline to 30%. The urbanization rate of permanent resident population will reach 60%. With rapidly expanding urbanization, investment will still play a dominant role in economic growth, real estate maintains high-speed growth, newtype industry develops fast, urbanization rate is accelerated, rapid recovery of overseas market will drive fast growth of export. China s average annual GDP growth rate in will be 7.5%. Low-growth Scenario Transformation of economic structure is failed, China s economy falls into Middle Income Trap', real estate market bubble breaks, investment growth rate falls down greatly, income growth slows down, consumption growth is restrained, and external demand is weakened. China s average annual GDP growth rate in will be 5.5%. GDP Growth Rate High-growth 7.4% 7.5% 7% 6% BAU 7.4% 6.5% 6% 5% Low-growth 7.4% 5.5% 5% 4% Singapore 03 4

5 million metric tons 3. China s oil products demand will grow at a lower-middle speed Scenario Forecast of China's Oil Products Demand ( ) Low-growth case Base case High-growth case The average annual growth rates in will be 1.4%, 2.9% and 4.2%. The average annual growth rates in will be 0.3%, 0.9% and 1.7% Singapore 04 5

6 Million metric tons Gasoline: China s passenger cars grows rapidly, driving rapid growth of gasoline demand Impact Factors: Passenger Car Population: average annual growth rate of 8%-16% in Fuel Saving Technology: average fuel consumption of new passenger cars in 2020 will be 5.0 L/100km, 30% lower than that in The average annual growth rate of China s gasoline demand in will be 3.7%, 5.6% and 6.3% respectively. Scenario Forecast of China s Gasoline Demand( ) Low-growth case Base case High-growth case Singapore 05 6

7 million metric tons Diesel: Economic transition will lead to sharp drop of China s diesel demand growth Sectors: transportation, agriculture, industry, construction, residential and others The average annual growth rate of China s diesel demand in will be -0.4%, 0.2% and 1.8% respectively. 80% of diesel demand increment is from transportation sector, while diesel demand increment in agriculture and construction sectors is small, and industrial diesel demand will even decrease. 250 Scenario Forecast of China s Diesel Demand( ) Low-growth case Base case High-growth case Singapore 06 7

8 million metric tons Kerosene: Rapid development of civil aviation will boost fast growth of China s kerosene demand Kerosene demand highly relates to aviation turnover, GDP, and per capita income. China s kerosene demand is expected to be 31MMt, 38MMt and 42MMt by 2020 under the low-growth, BAU and high-growth cases respectively. Annual average growth rate in will be 2.1%, 6.3% and 8.4% respectively. Scenario Forecast of China s Kerosene Demand( ) Low-growth case Base case High-growth case Singapore 07 8

9 Consumption of diesel-gasoline ratio continues to decline Gasoline consumption Diesel Consumption Diesel-gasoline Ratio Singapore 08 9

10 China s oil products will be in exceed supply in 2020, presenting the surplus in the East while shortage in the West pattern Gasoline Diesel kerosene Singapore 09 10

11 4. China s naphtha demand will grow at a lower-middle speed In 2015, China s ethylene production reached MMt (1.1% y-o-y); propylene production was 19.9 MMt (7.8% y-o-y); naphtha consumption totaled 35 MMt (7.2% y-o-y). Crude oil price stays low, while the economy of petroleum-base chemical rises again. Domestic naphtha demand will reach 39MMt and 48MMt in 2020 and 2030 respectively on BAU case, considering the growth of domestic petroleum-base ethylene output. Its average annual growth rate will be 2.2% and 2.1% in and respectively. Forecast of China s Naphtha Demand outlook Low-growth Case Base Case High-growth Case 20.4% 5.1% 2.2% 2.1% Singapore 10 11

12 5. China s oil demand will be high but with a lower growth rate Forecast of China s Oil Demand Development Trend Unit: 100 MMt Low-growth Case Base Case High-growth Case 7.8% 6.4% 4.2% 2.4% 1.1% AAGR Demand Elasticity Intensity(t/US$10000) Singapore 11 12

13 Per capita oil consumption (ton) 6. China s oil demand will reach the peak of 680MMt around 2030 Comparative analysis: compare and analyze the key factors that impact oil demand (economic aggregates and structure, population, urbanization, industrialization stage, alternative energy, etc.). Referring to experiences of developed countries and China's planning, China's total population and urbanizaton rate will be maximized in , thus China's oil demand peak will be 800MMt, yet acual demand will be approximately 680MMt. Model analysis: consider the factors such as GDP, industrial structure, population, energy consumption per unit from the aspect of demand; use the optimization methods of multiple regression and stepwise regression. We predict that China's oil demand will reach the peak of 680 MMt around Oil Consumption Peak of Developed Countries United States Japan Germany Korea After the oil crisis in 1970s, population and economy factors drive oil consumption to rise again; and after 2008, economic crisis and auto saturation lead to oil consumption peak again. Population aging arose from 1980s, economic and urbanization development drive oil consumption; Asian economic crisis occurred in 1990s, and alternative energy development drives oil consumption to reach peak volume. Fast development of diesel cars and improvement of automobile fuel economy has great impact on oil demand. Oil demand intensity began to fall after the Asian economic crisis GDP and oil consumption per capita of main countries in recent years Per capita GDP(US dollar) United States Germany France United Kingdom Japan India Singapore 12 13

14 7. Alternative Energy Will Develop Rapidly, but With Various Prospects Alternative energy represented by natural gas and electricity will develop more rapidly. Natural gas Methanol fuel Ethanol fuel CTL Biodiesel Electric locomotive Electric vehicle Substituting volume unit Bcm Mt Mt Mt Mt TWh Mt Mt 2012 (Material Volume) (Substituting Volume) Total (Material Volume) (Substituting Volume) (Material Volume) (Substituting Volume) (Material Volume) (Substituting Volume) Forecast of China s Alternative Energy as Substitutes of Oil Singapore 13 14

15 Conclusion The driving force of economy for oil consumption is weakened, oil demand will keep a low growth of 2%-3%, and external dependence rate will also increase. Characteristics of oil consumption demand will be low growth, low consumption and low pollution. Demand growth of different oil products continues to be diversified. Domestic oil products market is loose, and export (especially for diesel) is becoming large scaled. Alternative energy represented by natural gas and electricity will develop more rapidly Singapore 14 15

16 Thank you! CNPC Economics & Technology Research Institute () 16