Energy volatility could fast-track global EV adoption to 50% above base case, Wood Mackenzie finds

Wood Mackenzie says rising energy volatility and geopolitical pressure could accelerate global EV adoption far above its base case, with EVs rising from 4% of the global fleet today to 25% by 2040 in the base case, and up to 50% above that under an “electric shock” scenario. The report argues that high fuel prices, stronger government support, and faster battery innovation could sharply reduce oil demand, potentially to 99 million barrels per day by 2040, near current levels, and trigger early refinery closures. China appears best positioned, with annual EV sales potentially reaching 29.9 million by 2040, while the U.S. risks lagging without stronger policy support and advanced battery supply chains. Europe could also see a much larger EV fleet if it can balance industrial policy with decarbonization goals. The biggest investment needs are in copper, other critical minerals, charging infrastructure, and managed charging systems, highlighting potential long-term implications for oil, metals, utilities, and EV supply-chain equities.