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EV Surge Squeezes Oil Demand
22 Jun
Summary
- Electric vehicle sales surge could cut oil demand by 320,000 barrels daily.
- China leads global EV adoption, accounting for over 60% of the increase.
- Goldman Sachs predicts Brent crude could fall to mid-$50s by late 2027.
Global electric vehicle (EV) penetration has seen a notable increase, reaching 26.1% of total passenger car sales in May. This growth, observed across 12 of the world's largest EV markets, has been significantly driven by China, which accounts for over 60% of the rise in global adoption.
Goldman Sachs estimates that this accelerating EV adoption could reduce daily global oil demand by as much as 320,000 barrels by the end of 2027. Even a more conservative scenario, where EV penetration plateaus, would still result in a demand reduction of 0.13 million barrels daily.
The surge in EV sales is potentially linked to higher fuel prices and global energy market disruptions. This trend supports Goldman Sachs' projection that Brent crude oil could decline into the mid-$50s per barrel by late 2027.
