Higher oil prices are driving the electric car market says analyst
Electric vehicle adoption will ramp up faster in China and Europe than in the US, with the price and availability of oil being a major driver, S&P Global Platts Battery Metals Conference delegates have heard.
Electric cars could gain a 50 per cent market share in Western Europe by 2030, with China not far behind, Mark Schwartz, managing director of scenario planning for S&P Global Platts said.
China – the world’s largest market and maker of electric vehicles (or EVs) — has “a lot of powerful reasons to force electrification” — both economic and strategic.
China is the world’s biggest importer of oil and has felt the pinch of higher prices.
And amid to the ongoing trade war, no US crude was imported for the month of August, according to shipping analyst Peter Sand, despite crude being left off China’s official US tariff list.
“In the first seven months of 2018 China imported an average 10.6 million barrels,” Mr Sand said.
As tariff war continues, China is ditching American oil:
1) Jan. to July: China bought an average 350,000 barrels per day
2) August: 0
3) September: 30,000
(Source: EIA, WSJ table) pic.twitter.com/ECI5k9Uipj
— West Wing Reports (@WestWingReport) October 16, 2018
At current rates of demographic growth in China, if the country does not move toward electric vehicles it could theoretically end up on a trajectory of having to import 20 million barrels per day of oil, Mr Schwartz said.
“That’ll never happen.”
“It is easier for them to jump the queue rather than playing catch-up on the internal combustion engine with the US, South Korea, Europeans and others.
“We see [China] as being a major exporter (of EVs) to the world.”
And higher oil prices in Europe would lead to break even costs on EVs much sooner than in the US, where the low cost of fuel is considered a barrier to EV growth.
Significant EV growth in the US “will come later” due to a current “lack of government policies and lower gasoline prices”, Mr Schwartz said.