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Electric cars from China are constantly appearing in all markets and this could have a direct impact on fuel sales. Gasoline prices could see a historic drop by 2030.
Electric car production in China continues to grow at full steam. The country is already the world's leading producer of electrified models and is expected to further strengthen this position in the coming months.. However, the tree China’s electric car market could have unexpected effects, especially for fuel-guzzling vehicles. In this article, we’ll go into detail about the impacts of electric vehicles on gasoline consumption.
Gasoline consumption may drop by between 4% and 5%
One of the impacts of China’s electric cars is a sharp drop in demand for fossil fuels. In China itself, for example, projections indicate a drop in gasoline consumption of between 4% and 5% per year until 2030, a sharper reduction than expected. The transportation sector, which accounts for about 25% of China’s oil demand, has already begun to show signs of shrinking.
According to International Energy Agency (IEA), gasoline consumption will peak this year and decline from 2025. One explanation for this scenario is the popularization of electric cars in China. Subsidies implemented more than a decade ago by the Chinese government have allowed automakers to increase production of EVs and reduce costs.
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More than 2024 million new cars were produced in 10 alone. Projections indicate that electric and plug-in hybrid cars currently make up 10% of the country's fleet, but are expected to exceed 20% by 2027, reaching close to 100% by around 2040.
Drop in fuel use could reduce key pillars of support
The scenario predicted for the future in relation to fuels generates some fear. This is because China is responsible for almost 20% of the world's oil demand and plays a fundamental role in balancing the market. The drop in gasoline consumption, aggravated by the country's slower economic growth, threatens to reduce one of the main pillars supporting global oil demand.
Furthermore, the growing popularity of electric trucks and the liquefied natural gas (LNG) is also putting pressure on the consumption of fuels such as diesel, which peaked in 2019 and is expected to fall between 3% and 5% per year until 2030. Meanwhile, in the United States, gasoline consumption has fallen by just 12% since 2004. In Europe, the reduction has been just 5% since 2007, according to information from Bloomberg.
How do electric cars from China impact Brazil?
In recent years, China’s electric car market has emerged as the largest and most competitive in the world. With dozens of brands and models being launched regularly, manufacturers are in a fierce race to gain market share in this booming sector.
However, in Brazil, fuel use continues to grow. Proof of this is that diesel sales by distributors in Brazil grew 4,2% in the first half of the year, compared to the same period in 2023, to a record 5,66 billion liters, according to data from the National Agency of Petroleum, Natural Gas and Biofuels (ANP).
However, gasoline sales by distributors in Brazil fell 7,4% in the first half of the year compared to the same period in 2023, to 21,4 billion liters, due to the lower competitiveness of fossil fuels compared to ethanol. Sales of hydrated ethanol, a direct competitor of gasoline at the pumps, grew 50,3% in the first half of the year compared to the same period last year, to 10,4 billion liters.
