China's oil demand fell 1.5 percent year-on-year in August to 37.87 million metric tons, or an average of 8.95 million barrels a day, according to an analysis from energy and metals information provider Platts on Tuesday based on Chinese government data.

This was the second drop this year. Demand dropped 1.9 percent in June, but the figure was up 2.4 percent in July to a daily demand of 9.2 million barrels a day.

Demand in August was the lowest since September 2011.

Song Yenling, senior analyst at Platts, said the government's stimulus policies in the second half will take effect soon, which will result in a growth of the country's oil consumption. Meanwhile, as domestic refineries finish maintenance and oil prices rise, the output of the refineries is expected to grow.

The demand drop in June was the first since a 2 percent decrease in the first quarter of 2009 in the wake of the global financial crisis.