China's carbon dioxide emissions in the April-June 2026 quarter fell 1 percent compared to the same period the previous year, according to an analysis by the Centre for Research on Energy and Clean Air published in Carbon Brief. The driver this time was not declining coal use, but a sharp collapse in oil consumption: Chinese oil use fell 9 percent overall, and 16 percent in the transport sector. The analysis was authored by CREA chief analyst Lauri Myllyvirta as a guest contribution to Carbon Brief.
The backdrop was the United States and Israel's war against Iran beginning February 28, 2026, which led to the closure of the Strait of Hormuz, through which one-fifth of global oil and gas traffic previously flowed. China responded with a drastic cut in oil imports.
Electric vehicles emerge as the primary driver
The critical factor behind declining oil consumption was rapid electrification of cars, trucks, and buses, according to Myllyvirta. Electric truck sales rose approximately 77 percent year-over-year in the second quarter of 2026, while the total number of electric vehicles on Chinese roads grew 33 percent.
People and businesses also used their electric vehicles more intensively, possibly preferring e-taxis to personal gasoline cars, and public transit use increased as well. The effect of electric vehicles on oil consumption was nearly double what would be expected from vehicle numbers alone, indicating broader behavioral shifts.
The oil displacement from electric vehicles reached 36 million tonnes of oil equivalent in the first half of 2026, exceeding total British oil consumption over a six-month period. China cut oil imports by 3.6 million barrels per day, roughly equivalent to Japan's entire daily consumption. Global oil demand fell in the second quarter 2026 by 5.3 million barrels per day year-over-year, the first quarterly decline since the COVID-19 pandemic, according to the International Energy Agency. US oil consumption remained flat during the same period.
Coal consumption rose despite renewable growth
However, coal consumption for power generation rose 2.4 percent during the same quarter. China continues building new coal plants while simultaneously expanding wind, solar, and nuclear capacity. Grid operators often chose coal over renewables due to transmission bottlenecks and incentive structures favoring fossil fuel generation. Over the first half of 2026, China's emissions rose slightly after increasing 2 percent in the first quarter, remaining below their 2023-2024 peak. According to CREA, around 60 percent of the import decline in the second quarter reflected drawing down oil stockpiles rather than reduced consumption.
Myllyvirta said the situation strongly confirmed China's energy security strategy and especially the role of electrification within it. Rystad Energy analyst Tim Himle Levinh countered that an end to Middle East hostilities would likely bring a recovery in Chinese and global oil consumption, though he sees the long-term trend as downward.