China’s air clean-up could spell trouble for oil price

Authorities in China have ordered hundreds of factories to cut back activity ahead of the Group of 20 summit in Hangzhou in early September, in a bid to ensure clean air, but the restrictions may cut oil demand in the world’s second-biggest oil consumer.

Industry consultant Energy Aspects estimates the curtailments, along with flooding earlier this summer, may cut oil demand in China by 250,000 barrels a day in the third quarter.

The slowdown at facilities including refineries and petrochemical plants along the Yangtze River threatens to weaken Chinese oil imports that rose to record highs in the first half of the year.