EVs are reshaping the future of oil
The rapid rise of electric vehicles (EVs) marks a turning point in the global energy landscape.
As batteries replace combustion engines, oil demand is being reshaped — gasoline and diesel consumption decline, refinery economics shift, and entirely new product streams emerge.
Yet, this transition is not the end of oil — it’s the beginning of a smarter, more diversified energy system. Specialty fluids, advanced base stocks, and circular feedstocks are becoming growth engines for a resilient lubricant industry that adapts to electrification and sustainability.
Global oil demand is expected to plateau toward the end of this decade as electrification and efficiency gains take hold (IEA Outlook).
EVs are already reducing oil use — electric transport has displaced roughly 1.5 million barrels per day, and that number continues to rise as adoption accelerates (BloombergNEF Energy Transition Report).
As a result, refiners face a structural shift: less demand for transportation fuels and more emphasis on petrochemical feedstocks, base oils, and other specialty streams that offer higher margins and stability.
EVs mainly reduce gasoline and diesel consumption, particularly in mature car markets.
However, not all refinery outputs decline. Petrochemical feedstocks, lubricants, and specialty oils remain resilient.
Even though base oils make up a small portion of refinery output (typically less than 1%), they can contribute 5–15% of total value. That makes them a strategic product for refiners seeking margin stability in a lower-fuel-demand future.
EVs bring new technical demands that didn’t exist for internal combustion engines.
Thermal management fluids and dielectric coolants are now essential for battery cooling, insulation, and power electronics.
The global market for EV dielectric fluids is projected to grow rapidly through the 2030s, supported by the expansion of EV manufacturing and high-voltage system designs. This shift is creating a strong pull for high-purity Group III and synthetic base oils, which deliver the required stability and low conductivity.
Tighter OEM specifications and higher-performance requirements are accelerating the transition to Group II and Group III base oils, along with GTL (Gas-to-Liquids) and PAO products.
These cleaner, low-impurity base stocks deliver better oxidation resistance and viscosity control — qualities essential for EV fluids and modern lubricants.
As investment continues in new Group III and GTL projects, refiners can capture more value per ton even if overall lubricant volume growth slows.
Sustainability goals and policy pressures are driving the rise of re-refined and bio-based base oils.
Re-refining reduces reliance on virgin crude feedstock while lowering lifecycle emissions.
Bio-based stocks — such as esters and bio-PAOs — enable new “green lubricant” lines for OEMs and industrial clients.
The industry’s long-term future points toward a hybrid model: conventional, GTL, bio-derived, and re-refined streams coexisting to ensure supply resilience and compliance with ESG targets.
Lubricant and base oil demand growth is shifting toward non-OECD regions — especially in Asia, Africa, and Latin America.
Population growth, industrial expansion, and vehicle market development are creating strong regional demand even as mature economies plateau.
For companies, this means aligning product portfolios to regional API group preferences and building efficient supply chains that bridge production centers with high-growth markets.
To stay competitive through the EV era, refiners, traders, and lubricant manufacturers can take several strategic actions:
EVs are undeniably changing the shape of oil demand, but they are not eliminating the need for lubricants and specialty fluids.
In fact, as transportation electrifies, high-performance fluids become even more critical — ensuring efficiency, safety, and system reliability.
For companies like Synergy Sol Trading, the opportunity lies in bridging traditional energy and the electric future — combining trading expertise, product innovation, and regional insight to lead in the EV-era lubricant market.