Electric vehicle sales may visibly affect oil demand by 2027, according to a new report from BofA Global Research, which was sent to Rigzone this week.
In the report, BofA Global Research noted that, in previous publications, the company argued that global demand for transportation fuel would peak when electric vehicles as a proportion of total vehicles sold reached 20 percent one hundred. BofA Global Research revealed in its latest report that it estimated that the current penetration of electric vehicle sales is now 14 percent.
“Interestingly, gasoline demand in the US is already starting to decouple from miles driven, according to the latest data, even though electric vehicles only account for seven percent of total cars sold in North America,” BofA noted Global Research in the report.
“Increased sales of electric vehicles will eventually balance total demand for gasoline and transportation fuel in the medium term. However, the path is unlikely to be linear. Although sales of electric vehicles will continue to affect demand future of oil over the coming years, the speed of the transition will depend on the availability of scarce raw materials such as lithium, cobalt or copper,” the company added in the report.
“Rising lithium prices last year increased costs for automakers and reduced profitability, factors that could eventually slow the transition to a gasoline-free future,” BofA Global Research said in the report
In a separate report released last week, Rystad Energy said the adoption of electric vehicles is approaching the levels needed to offset annual global growth in the size of the active car fleet. In a report published in October 2022, Rystad Energy stressed that a “big jump” in demand for electric vehicles over the past three years had highlighted the “increasing importance of charging stations in key countries”.
In that report, Rystad Energy emphasized that its research showed that, at the time, public charging infrastructure was not a limiting factor for the rapid adoption of electric vehicles, “especially in emerging markets.”
“In countries such as Germany, France and the Netherlands, there is no direct correlation between the growth of charging infrastructure and the number of electric vehicles sold,” Rystad Energy said in the report.
“Of much greater importance to consumers are issues such as high fuel prices for combustion engines or high sticker prices for electric vehicles,” added Rystad Energy.
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