Could Electric Car Demand Crash the World’s Oil Markets ?

Could You Crash the World's Oil Markets by Buying an Electric Car?
Could You Crash the World's Oil Markets by Buying an Electric Car?

Could You Crash the World’s Oil Markets by Buying an Electric Car?

Is it possible that only a small increase in demand for electric cars could cause a world wide glut of oil followed by falling prices? I would be tempted to say that maybe this has already happened except not just due to electric cars, but also a steep increase in the efficiency of cars on the road today.

When you add to this a steep decline in demand for global resources including energy in China as a result of their economic down turn you have a similar situation to what some experts say may happen in the future just due to electric cars.

The supply and demand math for world oil prices

The supply and demand math for world oil prices

How many electric cars are on the road today?

There are more than one billion cars on the road worldwide today, and only one tenth of one percent of them have a plug. Tesla motors is working to build more factories for their popular electric vehicles and every major car and motorcycle manufacturer are planning electric products in the next two years.

The electric car S curve that could crash the world's oil markets

The electric car S curve that could crash the world’s oil markets

OPEC contends that even in the year 2040, EVs will make up just one percent. But don’t be so sure. By 2020, some electric cars and SUVs will be faster, safer, cheaper, and more convenient than their gasoline counterparts. What if people just stop buying oil?

Bloomberg projects the demise of the world’s oil markets by 2040

In this video, Bloomberg’s Tom Randall does the math on when oil markets might be headed for the big crash. I think that the added factor of combustion engines becoming more efficient through the use of lighter materials and technologies such as start-stop control, turbo and supercharging as well as variable displacement engines will likely accelerate this estimate and I contend the we may be witnessing the collapse of the oil market today.

In the coming months and years we will see if the price of oil recovers at least in part or if energy efficient ¬†gasoline engines , hybrid plugins and electric cars cause a permanent crash of the world’s oil markets.

Here is the video from Bloomberg.

About Gordon Smith
Gordon's expertise in the area of industrial energy efficiency and alternative energy. He is an experienced electrical engineer with a Masters degree in Alternative Energy technology. He is the co-founder of several renewable energy media sites including Solar Thermal Magazine.

No tags for this post.


  • Kamin Lambertson says:

    It’s already here.

  • Nicholas Chapman says:

    Good article Gordon. Will these efficiency gains and shifts to electric outweigh the increase in car ownership happening at the same time?

  • Bruce Miller says:

    Age of owning a gasoline car has withered away as young couples now a days work two, occasional or part time jobs just to eat and have a bed of their own. Add to this huge debts for education on their backs, and private ownership of a gasoline car becomes one of those out of reach items. Electric cars apparently need far fewer repairs, last much longer and retain value longer? Let the markets decide!

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.