China’s CO2 emissions fell 1% in Q2 as oil use dropped 9%

A disruption to Gulf supplies through the Strait of Hormuz affected China’s fuel system: in the second quarter of 2026, oil consumption fell 9% overall and 16% for transport. China’s total CO2 emissions fell 1%, even as coal-fired power generation rebounded.

Carbon Brief’s guest analysis, written by Lauri Myllyvirta, lead analyst at the Centre for Research on Energy and Clean Air, identifies a first in China’s emissions record: a fall in oil consumption was sufficient to drive an overall decline in CO2 emissions. In previous cases, coal consumption had been the main force behind changes in the national total.

Electric vehicles — cars powered by electricity rather than petrol or diesel — and public transport helped keep transport levels rising while fuel use fell. The effect of EVs on oil demand was almost twice as large as the increase in vehicles on the road alone would suggest, because existing EVs were used more. Oil consumption displaced by EVs in the first half of 2026 exceeded the United Kingdom’s total oil consumption over six months.

The numbers also contain a stockpile effect. China cut oil imports by 32% in the second quarter, while crude oil processing volumes fell 11% and Sinopec sales fell 9%. National Bureau of Statistics energy data indicated that oil consumption fell 3% in the first half and around 9% in the second quarter; the analysis says 60% of the fall in imports was still accounted for by the shift from building oil stocks to drawing them down.

Coal went in the opposite direction. Power-sector coal use grew 2.4%, while gas-fired generation fell 1.2%, because some wind and solar electricity was curtailed — effectively wasted when the grid and power market could not absorb it. China’s new five-year-plan documents call for measures to reduce that curtailment and set a higher bar for approving coal plants, but the existing coal-heavy system still limited how much new wind and solar displaced coal.

For China, the practical change is already visible in transport: EVs and public transit allowed transport levels to increase while oil use fell. For emissions, however, that gain is being contested by coal power. The national total has remained flat for more than two years after its March 2024 peak, and Myllyvirta’s analysis says it could still fall in 2026 as oil demand, real-estate construction and coal-chemicals growth weaken; the trend remains a race between energy-demand growth and clean-energy growth.