With its economy severely hampered by stringent measures to curb the spread of Covid-19, China’s oil and gas consumption declined in 2022 for the first time in decades, the International Energy Agency said, Report informs referring to The New York Times.
But after China’s recent reversal of its lockdown policies, the agency’s executive director, Fatih Birol, said he expected a sharp rebound in demand, which could mean higher energy prices in other markets.
The reduction in Chinese energy use last year kept world prices from soaring even higher after Russia’s invasion of Ukraine, giving relief to Europe and the US as they struggled to manage cuts in energy imports from Russia.
China’s reduced energy needs, combined with the unseasonably warm winter, mean that Europe “seems to be off the hook this winter,” Birol said in an interview. Many experts had expected energy costs to rise so high that European businesses would fail and a deep recession would follow.
He added that “next winter could be more challenging” since the weather could be colder, Russian fuel exports would be further reduced by Western sanctions over the war, and China’s economy would be recovering.
