Electric cars have been around for a very long time, but they always felt more like an ideal to aspire toward than a practical product—until now that is. CNBC predicts that electric car sales will rise to 30% of the entire pie by 2040. To put that in perspective, you can expect to be looking at 36 million electric cars on roads by 2025. This has been epitomized in Elon Musk’s attempt to achieve a sustainable energy economy, with Tesla Motors producing a large number of new and advanced models of electric cars.
The debate over whether electric vehicles will at some point replace diesel and petrol is currently favoring the use of fossil fuels, though. Let’s see how electric vehicles have impacted the demand for oil and gas.
What’s the future of Big Oil?
Not too long ago, big oil was hardly threatened by the minuscule sales of Electric Vehicles (EVs)—but now, the tables have turned. It’s no longer a matter of whether or not EVs will take over, but more of when they will! Analysts predict that if EV sales reach 33% by 2040, it could shrink oil demand to about 9 million barrels per day.
Supercharger stations where drivers can recharge their EVs are widespread. Tesla’s announcement of opening up their technology to several manufacturers meant that the electric car market’s infrastructure will only expand from here on, consequently reducing the demand for oil.
Environmental Impact
Analysts report that more than 3 million EVs are predicted to reduce 6.5 million tons of greenhouse gas emissions annually. This will create less dependency on foreign oil, further boosting the demand for domestic electricity. Moreover, this will lead to reduced emissions of harmful volatile organic compounds, carbon monoxide, and nitrogen that are harmful to respiratory health.
Rising fuel costs
40% of consumers who were previously unsure about buying EVs now report that higher gas prices are motivating them to reconsider their options. However, the US Energy Information Administration predicts gasoline prices to average at around $2.92 per gallon for the summer of 2019.
The evolution of auto mechanics
The rise of EVs will also lead to another major change in the transportation industry. Though vehicles will no longer require oil changes, that doesn’t mean they won’t require maintenance of brakes, windshield wipers and tires. However the 20 components of EV engines are far simpler compared to the 2,000 parts of an internal combustion engine. Analysts have pointed out that about 70,000 shops will experience a decline in business with the rise of EVs.
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