Oil & Gas

China to hit peak oil demand in 2027, says IEA

By Dania Saadi

June 17, 2025, 6:46 PM

Oil refinery in Shanghai. The IEA predicts that the global peak for crude oil consumption will be around 2029, but China's peak will arrive sooner

International Energy Agency forecast
Prediction for global peak unchanged
EV adoption is slowing oil growth

China’s crude oil demand will peak in 2027, earlier than previously forecast, as the energy transition gathers pace, the International Energy Agency said on Tuesday.

Chinese demand will hit a record 16.95 million barrels per day in 2027 and drop to about 16.66 million barrels per day in 2030, the IEA said in its report Oil 2025. It is the world’s second largest oil consumer.

However, the IEA left its forecast for the global oil demand peak unchanged, with consumption set to reach 105.57 million barrels per day by 2029, a rise of 2.5 million barrels per day from 2024.

“We see at the IEA, in this year, and in the next few years to come, really comfortable oil markets, barring big disruptions and geopolitics,” IEA executive director Fatih Birol said in a live-streamed press conference on June 17.

“There is still no room for complacency. There are so many uncertainties in geopolitics. There are so many surprises in geopolitics, in economics and trade. At the IEA, we believe energy security is a key issue for today and for tomorrow.”

Global oil demand is peaking because of the uptake of electric vehicles (EVs) in China and other regions, slower economic growth, especially in China, and the rapid switch from oil to gas for power generation, mainly in the Middle East, Birol added.

China, which accounted for 60 percent of global oil demand growth between 2015 and 2024, has recorded high EV sales, lower consumption of transport oil fuels and slower economic growth in recent years, the report said.

The IEA has lowered its forecast for 2025 global oil demand growth to 720,000 barrels per day, from 740,000. This contrasts with projections from Opec, which maintained its 2025 forecast at 1.3 million barrels per day in a report published on June 16.

While China was enjoying high oil demand, the US represented about 90 percent of the increase in global oil supply between 2015 and 2024. But now the rate of expansion is slowing down.

Between 2024 and 2030, US crude oil output is forecast to drop by 60,000 barrels per day to 13.1 million barrels per day. It hit a record 13.2 million barrels per day in 2024.

The forecast for US oil demand was revised upward by 1.1 million barrels per day to 20 million barrels per day for 2030, compared with last year’s report, thanks to lower gasoline prices, slower adoption of EVs and projections for higher economic growth, the IEA said.

“While US oil production is set to increase every year through the forecast period, the pace of growth will slow markedly as crude plateaus,” said the report.

Global oil supply is forecast to grow by 5.1 million barrels per day between 2024 and 2030, driven by additions in Saudi Arabia and the US.