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Oil shocks, high fuel prices, and EV tech advances could lift EV output
Wood Mackenzie projects EV market share could rise to 20% in the U.S. by 2040 and 35% in Europe, alongside grid upgrades for managed charging.
A new report from Wood Mackenzie says a trio of emerging economic forces could boost global electric vehicle output, with ripple effects across oil, power, and metals markets. The factors include oil supply shocks tied to wars in petroleum producing countries Russia and Iran, high fuel prices that push consumers toward EVs, and ongoing technological innovation, according to Reuters.
The report points to rapid battery progress in China, including 5-minute charging, plus battery chemistries such as sodium-ion and lithium iron phosphate. It also says Western countries may rely on government support to speed innovation, while policymakers may need to increase licensing of Chinese EV technology to improve resilience to oil price swings and bolster domestic supply chains.
Wood Mackenzie forecasts oil demand could decline to 99 million barrels per day by 2040, down from above 100 million bpd today, while EV adoption grows. It expects the U.S. EV market share to move from 3% today to 20% by 2040, and Europe to rise from 3% in 2025 to 35% by 2040, Reuters reported.
The company also links EV growth to minerals and energy infrastructure, saying global mineral supply could support 50% growth in global EVs by 2040, but delivery speed will be challenging. Wood Mackenzie estimates the world needs another $45 billion in metals investment over the next decade, with copper identified as a key bottleneck, and it calls for expanding managed charging to shift EV charging to periods with ample power supply.
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