Faster electric vehicle adoption could reshape oil, power, and metals markets, with global oil demand falling to 99 million barrels per day by 2040, Wood Mackenzie strategists said in a report on Thursday.
Wood Mackenzie's electric shock scenario combines oil supply disruptions, policy shifts and faster technological advances to accelerate EV adoption beyond its base-case trajectory.
About 40 oil refineries worldwide could close by 2040 as lower oil demand changes market requirements, while an additional $45 billion in metals investment could support 50% growth in the global EV stock.
Wood Mackenzie said several indicators could signal whether its electric shock scenario takes hold, including high oil prices, EV costs, and geopolitical events such as the conflict in the Middle East.
EV adoption varies sharply by market, with US passenger EV sales down 33% over the year in the first five months of 2026, while European sales rose 30% over the same period.
In China, falling gasoline vehicle sales lifted EV market share to 42% in Q2 2026 from 33% in Q2 2025, despite a small decline in EV sales volume, while Wood Mackenzie's base case sees EVs rising from 4% of the global vehicle fleet in 2025 to 25% in 2040.
EVs have already reached purchase-price parity with gasoline and diesel vehicles in China on a total-cost-of-ownership basis. Wood Mackenzie expects Europe to reach that point by 2030 and the US by 2033.
Higher fuel prices, stronger EV supply chains and faster technological advances, including five-minute charging, advanced lithium iron phosphate batteries and sodium-ion batteries, could further accelerate adoption.
The global public EV charging network can support near-term EV growth, with 7 million public charging ports operating at 15% utilization across major markets at the end of 2025, Wood Mackenzie said.
Faster EV sales under the electric shock scenario would quickly reduce that spare capacity, requiring a new wave of charging infrastructure investment to keep pace with demand.
China would need 4 million additional ports by 2040, requiring about $200 billion in extra investment, while Europe would need 2.7 million ports and $108 billion. The US would require 500,000 additional ports by 2040.
Countries will need to expand managed charging as EV power demand grows, shifting vehicle charging to periods when grid supply is ample and electricity costs are lower.
Utilities can manage home charging to ease peak demand, while consumers can align charging with renewable generation or excess grid capacity to lower charging costs.
Wood Mackenzie's base case sees global oil demand at 104 million b/d in 2040, but the electric shock scenario cuts that to 99 million b/d as faster EV adoption reduces transport fuel demand.
Lower oil demand would pressure refiners by reducing utilization and profitability, potentially accelerating the closure of about 40 refineries, with facilities in the Organization for Economic Co-operation and Development most exposed due to higher energy costs and carbon prices.