NEW DELHI: Electric vehicles are beginning to dent global oil demand in measurable ways. EVs could displace as much as 5 million barrels of oil demand per day (mbd) by 2030 under current policies, according to the International Energy Agency’s (IEA) Global EV Outlook 2026, reducing oil demand from road transport to around 44 mbd by the end of the decade. EVs displaced an estimated 1.7 mbd in 2025.
For India, the shift could carry significant economic implications. Lower oil consumption could help reduce the country’s crude import bill, even as wider EV adoption gradually raises electricity demand.
Mint explains what rising EV adoption could mean for oil demand, electricity consumption and India’s position in the global EV market.
Total EV sales in India rose 16% in 2025 to 2.35 million from 2.02 million in 2024, according to the government’s Vahan data, which is also used in IEA calculations. Electric vehicles accounted for about 8.16% of new vehicle registrations in India in 2025. The government has set a target of EVs accounting for 30% of all new vehicle registrations by 2030.
How much oil demand can EVs displace?
The IEA assessed future EV adoption under two scenarios in its Global EV Outlook 2026: a current policy scenario (CPS), which reflects policies already in force, and a stated policies scenario (STEPS), which also includes announced measures.
Under the CPS, EVs could offset 5 mbd of oil demand globally by 2030, rising from 1.7 mbd in 2025.
In a net-zero scenario, where countries prioritize energy transition measures to achieve net-zero emissions by 2050, oil demand displacement could rise to 7.5 mbd by 2030, the IEA said.
China, the world’s largest EV market, already saw EVs offset around 1 mbd of oil demand in 2025. Without EV adoption, China’s oil demand for road transport would have been around 15% higher.
For India, lower oil consumption could translate into substantial savings on crude imports. Prime Minister Narendra Modi on 10 May called for the judicious use of fossil fuels and maximising the use of EVs amid energy-security concerns arising from the West Asia crisis, Mint reported on 11 May.
India imported $123.1 billion worth of crude oil in FY26, down from $137 billion in FY25, according to data from the Petroleum Planning and Analysis Cell.
What happens to power demand as EV adoption rises?
While EVs reduce oil consumption, they also increase electricity demand. Even so, the IEA’s projections suggest EV-related power demand in India could remain relatively modest compared with larger EV markets over the next decade.
In 2025, EVs accounted for around 0.2% of India’s total electricity demand, compared with 0.9% globally, 1.7% in the European Union and 1.6% in China, according to the IEA. India’s peak electricity demand stood at around 270GW in 2025, according to power ministry figures cited by the agency.
Under the current policy scenario, EV-related electricity demand in India could rise to 0.8% by 2035. Globally, the figure could rise to 4.1%, while China could reach 5.8% and the EU 11.3%.
The IEA said electricity demand from EVs is expected to grow more gradually in China than in the EU because electricity consumption from sectors such as industry and buildings is also rising rapidly in China.
The report also suggests other emerging markets could see faster EV-related power demand growth than India. In 2025, EVs accounted for around 0.3% of electricity demand in Southeast Asia and 0.2% in Latin America, broadly comparable with India.
By 2035, however, EV-related electricity demand could rise to 2% in Southeast Asia and 1.3% in Latin America, compared with 0.8% in India under the CPS.
Where does India fit into the global EV market?
India’s EV market remains concentrated in mass mobility segments rather than passenger cars, giving it a distinct position in the global transition.
According to the IEA, India is the world’s second-largest market for electric two-wheelers, the largest market for electric three-wheelers and the third-largest market for electric buses.
India remained the second-largest market for electric two-wheelers in 2025 despite slower growth. Sales of electric two-wheelers rose 5% to under 1.3 million units, accounting for around 6% of overall two-wheeler sales in the country.
The IEA attributed the slower growth to a combination of tapering subsidies, a reduction in GST advantages for EVs, and tighter local value-addition norms.
In electric three-wheelers, India, China and Turkey together accounted for nearly 95% of global sales, according to IEA data. More than 60% of three-wheelers sold in India were electric.
India’s electric bus market also expanded in 2025, supported by schemes such as PM E-Drive and PM E-Bus Sewa. E-bus sales crossed 4,000 units during the year, the IEA said.