First nibbling, soon chomping.
Faster than predicted impacts on oil demand will begin to cut into profit margins for new drilling. There are several very active growing tips of the transition.
Big companies find that EVs make for much cheaper and more competitive delivery fleets.
One wild card is E-bikes, which are competing directly against gasoline powered cars, not regular bicycles, as described in the video above.
There is plenty of crude oil sloshing around the global economy right now, which has kept crude oil prices relatively low. Brent crude stands just below $63 a barrel and West Texas Intermediate is around $59.
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And prices are low in part because the market’s gotten crowded. For one, there’s the U.S.,which produced a record amount of crude in September. Hugh Daigle, an engineering professor at the University of Texas at Austin, said that’s partly because U.S. oil producers have gotten more efficient.
“As it stands right now, most basins here in the U.S. are still profitable,” he said, even at $60 or so a barrel.
But it’s not just the U.S. boosting supply, said Matt Smith, lead oil analyst for the Americas at data firm Kpler.
“We have Brazil hitting record production. We have Canada also showing increasing output. You have Norway increasing production,” he said.
There’s also new offshore drilling elsewhere in South America. A lot of this new output was planned years ago, but it takes a while to get a new oil rig going.
“It’s like London buses. They’ll all come along at the same time,” Smith said.
And that’s the challenge for OPEC.
“It’s not just one player that they’re having to deal with here, but it’s a number of them all increasing, getting up to record production at the same time,” Smith said.
All of that supply is hitting kind of tepid demand, said Clark Williams-Derry at the Institute for Energy Economics and Financial Analysis.
The global economy is a bit shaky. And, especially in Europe and Asia, “electric vehicles are starting to bite into gasoline demand, into diesel demand,” Williams-Derry said. That’s pushing down the price of crude.
For the rest of us who don’t drive EVs, that means lower gas prices. The U.S. average is now under $3 a gallon.
Surge in EVs on roads came heavy on the oil industry. IEA says that electric vehicles slashed oil demand by over 1.3 million barrels per day (mb/d) in 2024.
It was a steep 30% jump from 2023, and the present figures are nearly equal to all the oil Japan currently uses for transportation.
Passenger cars and small vans classified as light-duty vehicles (LDVs) drive most of this shift. Today, they account for 80% of the oil displaced by EVs. By 2030, their share will slightly drop to 77% as electric trucks and buses gain traction.
This is because of the rapidly evolving batteries and stronger charging infrastructure, these heavy-duty vehicles will likely displace nearly 1 mb/d of oil within the decade
IEA analysts highlighted that even if global oil prices fall to $40 per barrel, EVs remain cost-effective especially with home charging. This way drivers can continue saving money by switching to electric vehicles.
China is replacing its diesel trucks with electric models faster than expected, potentially reshaping global fuel demand and the future of heavy transport.
In 2020, nearly all new trucks in China ran on diesel. By the first half of 2025, battery-powered trucks accounted for 22% of new heavy truck sales, up from 9.2% in the same period in 2024, according to Commercial Vehicle World, a Beijing-based trucking data provider. The British research firm BMI forecasts electric trucks will reach nearly 46% of new sales this year and 60% next year.
Heavy trucks carry the lifeblood of modern economies. They also contribute significantly to global emissions of carbon-dioxide: In 2019, road freight generated a third of all transport-related carbon emissions.
Trucking has been considered hard to decarbonize since electric trucks with heavy batteries can carry less cargo than those using energy-dense diesel. Proponents of liquefied natural gas have viewed it as a less polluting option while technology for electric heavy vehicles matures.
China’s trucking fleet, the world’s second-largest after the U.S., still mainly runs on diesel, but the landscape is shifting. Transport fuel demand is plateauing, according to the International Energy Agency and diesel use in China could decline faster than many expect, said Christopher Doleman, an analyst at the Institute for Energy Economics and Financial Analysis.
Electric vehicle fleets are transforming companies’ approach to logistics.
With trucks responsible for nearly 40% of global transport emissions, electrification is fast becoming a necessity.
EVs cut tailpipe emissions to zero, slash air pollution in congested cities and offer lower running costs thanks to fewer moving parts and cheaper charging.
As emissions zones tighten and deadlines loom for combustion engine phase-outs, going electric now means future-proofing operations.
Thanks to government incentives, happier drivers and credits for clean transport, EV fleets are morphing beyond sustainability tick-box exercises into truly valuable business moves.
NB: Kevin Walmsley’s presents oil replacement data for “2 and 3-wheeled vehicles” as from “e-bikes”.
While a large proportion of them may be electric bicycles, that category also includes e-scooters (2- and 3-wheeled) and e-rickshaws. (Yes, a Vespa has two wheels, but I balk at referring to it as a “bike”.)