Oil Shock Fuels EV Boom, Metals Markets on High Alert
The ongoing Iran war and Ukraine conflict are accelerating the electric vehicle (EV) market as high gasoline prices stimulate consumer demand for alternatives. This surge in EV sales has significant implications for both the oil and metal markets, particularly for critical EV inputs like lithium, nickel, and copper.
Although global EV sales grew by only 4% year-on-year from January to August, regional markets are experiencing wildly differing growth rates. In Europe, sales jumped by 36% year-on-year in August, while the US saw a decline of 33% year-on-year in August due to the elimination of government subsidies.
China is another weak spot, with EV sales shrinking by 12% year-on-year in the January-August period. However, this should be seen in the context of a broader downturn in the domestic vehicle market. Chinese auto companies are exporting record amounts of EVs to the rest of the world.