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Norway Oil Demand Resilient to EV Surge — For Now

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Oil’s long dominance of road transport is facing a growing threat from electric vehicles (EVs). The EV surge is more pronounced in Norway, where around four out of every five cars registered last year were electric, with near 100% EV sales likely in the next few years. This is thanks largely to generous government subsidies, which many other countries may not be able to match. Nonetheless, Norway offers us a glimpse of what an EV dominant future might look like, not least for oil demand. Norway’s oil consumption is declining — but not precipitously. It was around 199,000 barrels per day in December 2021, down from around 204,000 b/d a year earlier — but this is really just a continuation of a decade-long trend also driven by improved vehicle efficiency. The main reason for this modest impact is the time it takes for new EV sales to change the overall fleet composition. By the end of 2021, Statistics Norway counted 460,734 EVs on the roads there, compared with an overall private car fleet of 2,893,987, and according to official data, EVs still account for less than 20% of overall transport energy use in Norway (see graphic). More recent data could show a bigger impact on oil consumption from last year's EV surge.

Topics:
Electric Vehicles, Low-Carbon Policy, Oil Demand
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