China’s electric taxi and rideshare boom is giving the world’s largest crude importer a new defense against oil shocks, as higher gasoline prices push more urban travelers out of private petrol cars and into cheaper app-based rides.
Rideshare Trips Rise As Fares Fall
Chinese passengers took 3.05 billion taxi and rideshare trips in May, Reuters reported on Wednesday, citing government data. Trips rose 6% from March through May compared with the same period last year, even as oil-market stress from the war in Iran lifted fuel prices.
The shift reflects two forces working together. More drivers are entering ride-hailing as China’s economy slows, while cheaper electric cars reduce operating costs and push fares lower. A part-time Beijing ride-hailing driver surnamed Li told Reuters that fares have fallen 10% to 15% since he started six months ago. “Competition is intense,” he said.
That price gap is changing consumer behavior. “Especially when gas prices are high, I’d rather take a taxi to places that are too far to bike to. That way, I don’t have to look for parking or pay for gasoline,” said Yang, a 45-year-old petrol-car owner who gave only her surname.
Electric Fleets Cut Fuel Demand
About half of China’s 1.3 million taxis are electric, and the share is near 100% in major cities, Reuters reported, citing the Ministry of Transport. DiDi Global (OTC:DIDIY) said it added 2 million hybrid or electric cars last year, taking its non-fossil-fuel fleet to 8 million vehicles, with EVs accounting for 75% of mileage.
The impact is already visible in fuel data. China burned 10% less gasoline and 14% less diesel in May from a year earlier, even as road freight rose 2% and May Day road travel hit a record. The International Energy Agency says China accounted for almost two-thirds of global electric car sales in 2024, reinforcing the scale of the shift.
“As fuel prices have gone up, people are driving their own petrol cars less,” said Daizong Liu, East Asia director at the Institute for Transportation & Development Policy in China. “But overall travel demand is still increasing, so more trips are shifting to public transport, such as taxis and the subway.”
Oil Dependence Faces Structural Shift
China’s wider EV transition includes BYD Co. Ltd. (OTC:BYDDY) (OTC:BYDDF) and Chery Automobile’s overseas expansion, BYD’s export-led rebound, and market signals showing battery stocks gaining as the Iran war lifted oil.
J.P. Morgan analyst Natasha Kaneva, in a note earlier this month, said the conflict “may have accelerated behavioral changes that were already underway, leaving China structurally less dependent on oil than the market has historically assumed.”
Reuters said China’s oil imports fell 41% in June from a year earlier, helping free cargoes in a tighter global market.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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