- EVs are far less exposed to oil shocks, with petrol costs rising much faster when crude prices spike.
- T&E says petrol cars in Europe could be hit five times harder than EVs if oil stays above $100 a barrel.
- Europe’s growing EV fleet is already cutting oil use, softening the impact of global fuel price spikes.
The war in Iran has disrupted global oil supplies, driving up fuel prices around the world and stoking fears that things could get much worse. It stands to reason that drivers of combustion cars are more exposed than EV owners.
A new study explores just how much better off electric car owners will be as gas prices surge.
Clean energy advocacy group Transport & Environment estimates that gas car drivers in Europe will be hit five times harder than EV drivers if oil stays above $100 a barrel. It predicts that the cost to drive 100 kilometers (62 miles) will increase to €14.20 (up €3.80) for gas-powered cars. Electricity costs will rise too, but the impact will be much less severe. The group estimates that the cost to cover the same distance in an EV will increase to €6.50 (up just €0.70). It conducted its analysis based on what happened during the last oil shock, after Russia invaded Ukraine in 2022.
Photo by: Transport & Environment (T&E)
The effect will vary by country depending on electricity prices and how power is generated, but the broader point remains valid: EV drivers are generally less exposed to oil price shocks because electricity prices do not follow crude oil as closely as pump prices do. Higher oil prices will likely put upward pressure on electricity generation costs, the organization notes, but electricity rates are not prone to big swings.
It also helps that EVs can be powered by renewables, which are not directly impacted by spiking oil and gas prices.
“Electric cars are the best bet to ensure this never happens again,” Lucien Mathieu, cars director at T&E said in a statement. “A Trump or an Ayatollah can control the oil taps, but they can’t control the wind and the sun.”
The European Union had planned to effectively end sales of new combustion cars after 2035. But after pushback from the auto industry and some leaders, it watered down the policy, leaving room for some combustion-engined cars to remain on sale beyond that date.
EVs are already doing their part to reduce Europe’s dependence on oil. Around 1 billion barrels of oil were imported into the EU last year for cars alone, at a cost of €67 billion. But the over 8 million EVs already on European roads helped avoid an estimated 46 million barrels, saving the bloc around €2.9 billion, T&E says.
The upward trend will continue in the EU, where EV sales are still on the rise. Reuters reports that, even though global EV sales fell 11% in February (mainly due to declines of 32% in China and 35% in North America), they rose in Europe by 21%.
The International Energy Agency confirms the broader point that “the transition to a more electrified, efficient, renewables-rich energy system will reduce overall exposure to fossil fuel price volatility.”
So add that to your list of reasons to choose an electric car over one that burns fuel. It’s not only better for your local air quality and uses its energy more efficiently, but it also does a better job of protecting you when things go sideways.
