EVs and Public Transportation Reduced China’s Wartime Demand for Oil

A September 3, 2026 CarbonBrief report said China’s carbon dioxide emissions fell 1% in the second quarter of 2026, with a sharp decline in oil consumption playing a major role. Oil use dropped 9% overall and 16% in transportation, according to the analysis.

Electric vehicles and public transportation are becoming increasingly important factors in China’s oil demand, allowing transportation activity to continue growing even as gasoline and diesel consumption falls. The impact of EVs on oil consumption was almost twice as large as would be expected from the growth in the number of EVs alone because vehicles already on the road were being used more frequently.

The shift toward transportation electrification was already underway before the disruption to global oil supplies caused by the Strait of Hormuz crisis. Sinopec had forecast 6% and 5% declines in diesel and gasoline consumption, respectively, for 2026. Actual sales of the fuels fell 9% during the first half of the year.

Transportation activity did not decline significantly. Cross-regional passenger trips increased 0.1% year over year during the second quarter, urban passenger trips rose 2.9%, and commercial freight tonnage increased 2.4%. Air travel was an exception, with passenger numbers falling 7% in May and June, although aviation represents a relatively small share of China’s overall transportation oil consumption.

Higher fuel prices during the Hormuz crisis accelerated transportation changes that were already underway.

Electric heavy-truck sales increased about 77% year over year during the second quarter. June sales more than doubled, while electric trucks accounted for more than 45% of all new truck sales.

The overall number of EVs on China’s roads increased 33% year over year. About 12.1 million EVs were added during the period, including 8.1 million battery-electric vehicles.

EV utilization increased even more rapidly. Charging volumes rose 60% during the second quarter, indicating that existing EVs were being used substantially more than before, replacing trips that otherwise would have been made in gasoline- or diesel-powered vehicles. Plug-in hybrid drivers also appeared to favor electric operation over gasoline as fuel prices increased.

The growing use of electric taxis contributed to this trend. Increased competition in the taxi sector pushed prices lower while operating private gasoline vehicles became more expensive.

Rail transportation also contributed to the reduction in petroleum demand, with passenger rail traffic increasing 5% during the first half of 2026.

The decline in diesel demand was particularly pronounced in the construction and mining sectors. Heavy machinery used in those industries is considered well suited to electrification, while declining construction activity also reduced fuel demand.

Based on reported growth in EV charging volumes, EVs avoided an estimated 19 million tonnes of oil consumption during the second quarter, an increase of 50% from the same period in 2025.

That brought total oil displacement from EVs to 36 million tonnes during the first half of 2026. Trucks represented the fastest-growing source of oil displacement, with avoided fuel use increasing 90% year over year during the first half.

The amount of oil displaced by EVs during the first half of 2026 was equivalent to 4.5% of China’s oil imports during the same period in 2025. If EV sales and charging volumes continue growing at the same rates during the second half of the year, EVs could displace approximately 80 million tonnes of oil during 2026, an amount comparable to Mexico’s oil consumption.

The emissions impact is also significant. EVs were estimated to have avoided 35 million tonnes of CO2 during the period, equivalent to 1.3% of China’s total second-quarter CO2 emissions after accounting for emissions associated with electricity used for vehicle charging.

The increase in oil displaced by EVs still accounted for only about one-third of the overall decline in China’s oil consumption during the first half of 2026. Other factors included changes in consumer behavior and operational changes by businesses.

China’s transportation electrification is increasingly becoming a structural factor in oil demand. The country’s EV deployment and utilization accelerated from an already high base during the second quarter, demonstrating how electric transportation can reduce petroleum consumption without requiring a corresponding reduction in transportation activity.

The trend also extends beyond passenger vehicles. Rapid growth in electric heavy trucks is increasing the amount of diesel displaced by electrification, while electric taxis and increased EV utilization are further reducing gasoline demand.

China’s government is targeting continued electrification, with a goal of EVs making up 30% of the country’s vehicle fleet by 2030, compared with 12% in 2025. The target also calls for EVs to account for 25% of commercial vehicles.

Carbon Brief’s analysis estimates EV-related oil displacement using vehicle sales data from the China Association of Automobile Manufacturers, broken down by vehicle type and powertrain. The analysis considers passenger cars, buses, vans, semis and trucks of different sizes, with each category separated into battery-electric and plug-in hybrid vehicles.

The estimates assume annual mileage and fuel consumption for comparable internal-combustion vehicles. Each battery-electric vehicle is credited with avoiding the fuel that a comparable conventional vehicle would have consumed, while plug-in hybrids are credited only for the portion of driving completed using electricity.

China’s National Energy Administration reported 142.3 TWh of new-energy-vehicle charging in 2025 and 56.9% year-over-year growth in charging during the first half of 2026.

The combination of rapidly expanding EV sales and sharply increasing charging activity indicates that electrification is becoming a major structural force in China’s transportation energy market, with EVs displacing increasingly large quantities of oil while reducing transportation-related emissions.