Simple not morbid at all example is me buying an EV instead of a gas car and leaving the heat at 68 instead of 70 this winter. That destroys some demand for oil.

I'm guessing China? China has shown the world that it can tolerate the shock, and it was even a huge boon for them as they are successfully exporting excess EV production. World demand is significant, China alone was expected to increase world oil demand to a breaking point, and that isn't happening, and in fact, China is exporting oil demand destruction.

EV adoption removes demand for oil as does replacing home heating oil with heat pump etc.

Many uses for oil are based on existing infrastructure, build different infrastructure and demand falls.

Oil prices will increase until enough people stop buying it that the decrease production is canceled out.

We as a planet were approaching Peak Oil consumption and this mishap has just acclerated that slightly. In all likelyhood annual oil consumtion will slowly decline or maybe quickly.

Demand destruction is a specific concept in economics where high prices for something cause a lasting reduction in demand. The other comments explain typical mechanisms for this, like high prices for fossil fuels spurring on electrification of machinery powered by fossil fuels, which then reduces the demand base for fossil fuels. Or the downturn of economies being accelerated by fossil fuel pricing pressure, increasing deindustrialization, and reducing fuel demand (e.g. what europe is experiencing).

Destroying demand is about getting people to not consume the thing. Oil being a knock on everything else and at such a volume would probably starve millions at the very least. This whole thing is a depopulation war. If you're reading this, you're on the losing side.