Sluggish oil demand and plunging imports are the latest signs of China's economic doldrums, analysts say.
High single-digit and double-digit growth rates in China's main energy segments have given way to some of the weakest figures that the country has generated in years.
In August, oil imports fell 12.5 percent from a year earlier to the equivalent of 4.3 million barrels per day, according to customs data.
The drop compares with a 6.7-percent rise a year before and a 6-percent growth rate for all of 2011, when oil imports averaged over 5 million barrels per day.
Sharp declines in oil imports were recorded not only from Iran, which is subject to Western sanctions, but also major suppliers like Saudi Arabia, Oman and Kuwait with cuts as high as 42 percent.
Contributing factors like price variations and refinery maintenance can be reasons for caution in drawing conclusions from a single month. Oil imports so far this year are still up 7.3 percent.
But China's implied oil demand in August was the lowest in nearly two years, sliding 3.7 percent from July, Reuters estimated. Net fuel imports were down 90 percent from a year earlier, and year-to-date oil demand has grown only 1.1 percent.
Similar forces have been felt in the coal industry where eight-month sales of 2.47 billion tons rose only 4 percent, compared with a 14.7-percent growth rate a year before, the China National Coal Association said.
Electricity use also increased by a slight 3.6 percent in August, largely due to declines in the industrial and manufacturing sector, the National Energy Administration (NEA) said. The rate was a shadow of the 11.7-percent rise in power consumption in 2011.
Analysts see the slippage in energy growth as a symptom of the slowing economy, perhaps to a pace even lower than the 7.6-percent GDP growth in the second quarter.
"It's looking more and more like a hard landing," said Mikkal Herberg, energy security research director for the Seattle-based National Bureau of Asian Research, citing some third-quarter GDP growth forecasts as low as 5 percent. "That's a recession in Chinese terms," Herberg said.
"The slowdown in oil demand, coal and power is pretty much all attributable to a relatively hard landing, particularly for heavy industry," said Herberg in an interview.
On Sept. 26, a government policy adviser warned that GDP growth is likely to decline for the ninth quarter in a row.
August economic data was "worse than expected" and the outlook is "gloomy," said Zheng Xinli, deputy head of the China Center for International Economic Exchanges, the official English-language China Daily reported.
The government has tried for the past year to engineer an economic soft landing. Among many forecasts, the international investment bank UBS predicted last week that third-quarter growth would come in at a relatively soft 7.3 percent.
Kevin Jianjun Tu, senior associate in the energy and climate program at the Carnegie Endowment for International Peace in Washington, agrees that the energy trend is a sign of economic weakness, although it is hard to tell how steep the dip is.
"I would say it's an early indicator that the economy is slowing down now in China," said Tu, but he cautions that statistical distortions in China's data make it hard to forecast GDP growth from energy figures.
Normally, power consumption has exceeded GDP growth by a fairly consistent margin. Last year, for example, power use rose 11.7 percent while GDP grew at an adjusted rate of 9.3 percent.
If electricity use is now increasing at only a 5-percent pace, it could mean the economy is growing even less.
But Herberg agrees there are problems in drawing such a conclusion. For one thing, heavy industry has an "asymmetric" effect on energy data because it accounts for the biggest share of power consumption.
When industrial sectors like steel go into a slump, it may drag energy figures down, although the service sector continues to do relatively well, Herberg said.
In the first eight months, China's steel production rose 2.3 percent, down from 10.6 percent in the year-earlier period, the official Xinhua news agency reported, citing the National Development and Reform Commission (NDRC).
In theory, smaller increases in energy use could also be due to greater gains in efficiency as measured by the "energy intensity" index, which tracks energy use per unit of GDP.
The government has yet to report the energy-to-GDP results from the first half of this year, but last year it claimed an efficiency gain of about 2 percent, or 1.2 percent below the planned target.
Under the last five-year plan through 2010, the government's goal was for 4-percent annual savings, but even that rate would not account for the lower growth in energy use.
"Energy intensity improvement itself couldn't explain the drastic slowdown of China's power consumption," Tu said.
Herberg said the impact of any efficiency gains on the energy numbers are likely to be marginal at best.
"I think a full 99 percent of the effect is just the brute force of the industrial slowdown," he said.