Falling battery prices and the electrification of transport systems in emerging markets will reduce dependency on oil imports and decimate demand for oil.

Emerging markets are now facing a choice between importing expensive oil at rising prices and growing dependency, or domestic electricity, produced by renewable sources with prices falling over time.

Oil demand is highly problematic

Emerging market oil importers spend 2% of GDP on oil imports, have a high and rising dependency on imported oil, and suffer premature deaths of 285,000 people a year from pollution linked to transport.

Greening transport gives solutions

The electrification of transport and falling battery prices enable electric vehicles to compete directly on purchase price with ICE vehicles whilst reducing the cost of energy imports per vehicle by at least 90%, cutting the number of premature deaths from air pollution linked to transport by at least 75%, and lowering the cost to consumers by at least two thirds.

The emerging market transport leapfrog

China is leading the way in electric vehicles. In 2019, EV made up 59% of bus sales and 61% of 2-wheeler sales.

Elsewhere, markets are poised to follow. The Indian government targets 30% of car sales to be EV by 2030 and early adoption sectors like 2-wheelers are taking off from India to Vietnam.

An emerging market transport leapfrog would reduce expected 2030 demand by over 70% in a Business As Usual scenario. Factor in the war on plastics, and it becomes ever more likely that oil demand has already peaked.