The price of oil soaring down electric car demand welcomes a "gradual" transformation, will European and American car manufacturers' "return to internal combustion engines" suddenly come to a halt?

The Middle East crisis continues to spread, analysts say, which will drive automotive consumers to switch from traditional fuel cars to electric cars, but early signs show that this shift will be gradual. The Iran war has severely disrupted oil exports through the strategic Strait of Hormuz, which usually carries about one-fifth of the world's oil and liquefied natural gas (LNG), exposing the global dependence on fragile fossil fuel trade routes and causing widespread inflation concerns as oil and gas prices soar. Since the end of February, many car sales platforms in the US and Europe have reported a significant increase in consumer interest in electric cars. This emerging trend comes at a time when a large part of the traditional automotive industry is shifting back to internal combustion engine cars. Online car trading platform Autotrader reported on March 26 that since the outbreak of the Iran war on February 28, inquiries about buying new electric cars have increased by 28%, and inquiries about buying used electric cars have also grown by 15%. Electric car specialist company Octopus Electric Vehicles reported on March 25 that inquiries about electric car rentals have increased by 36% since the conflict began. However, American car companies Ford, General Motors, and the parent company of Jeep, Stellantis NV, have all adjusted their electric strategies, writing off hundreds of billions in impairment and restructuring costs, partly due to weak consumer demand and political changes. JATO Dynamics' Senior Advisor Steffen Michulski pointed out that despite the evolving situation, the impact of the Iran war has clearly shifted toward changes in demand for electric cars. With the soaring oil prices increasing the operating costs of traditional gasoline cars, owning a pure electric car (BEV) has become more attractive for drivers with high mileage. Michulski suggested that switching to electric cars may also provide additional energy security for households, but he also cautioned against oversimplifying the situation. He pointed out that if inflation and supply chain costs continue to rise, the overall economic environment may weaken, and these broader pressures will affect all power systems, whether electric or gasoline. In summary, Michulski said, "In short, yes, high oil prices and renewed focus on energy security may boost demand for pure electric cars in the medium term, but this should be seen as a gradual shift rather than a market-wide acceleration. Electricity price risks, advances in fuel technology, and overall economic uncertainty serve as balancing factors." The number of car buyers considering electric cars has increased Erin Keating, Senior Director of Economics and Industry Insights at Cox Automotive, said that rising gasoline prices may prompt more consumers to consider pure electric cars, but the behavioral shift in purchasing from fuel cars to electric cars may be slow. Cox predicts that it will take maintaining high oil prices for more than six months to significantly change consumer habits in buying electric cars. Keating highlighted the barriers such as cost, charging facilities, and range anxiety (fear of running out of electricity midway) that still exist. According to Cox's data, the average price of new electric cars in the first quarter in the US was $55,300, which is lower than previous quarters but still higher than the average price of non-electric cars at $48,768. Despite the rise in oil prices, electric car sales in the US remain sluggish, with Cox predicting a 28% drop in first-quarter electric car sales to 212,600 units. However, sales of electrified vehicles, including electric cars and hybrid cars, continue to grow because car manufacturers are shifting their focus from pure electric cars to hybrid cars, seeking a compromise to meet consumer expectations for fuel economy. Cox pointed out that electrified vehicles, led by Toyota hybrid cars, are expected to account for 26% of new car sales in the first quarter, setting a record high. Early data from Edmunds.com, a subsidiary of CarMax, shows that rising gasoline prices are prompting more car buyers to consider electrified vehicles. Edmunds stated, "Fuel costs have a long-term impact on consumers' choice of their next vehicle because it is the most tangible item in vehicle operating costs. But whether the recent surge in oil prices can a substantial shift towards electrification depends more on consumers' expectations of sustained high fuel costs than on oil prices themselves." A faster transition? In Europe and Asia, the energy shock triggered by the Iran war is expected to more profoundly drive the transition to electrification than previous fossil fuel crises. Julia Poliscanova, Senior Manager of Vehicles and e-Mobility Supply Chain at the non-governmental organization "Transport & Environment" (T&E), said, "We are talking about electric cars again, as if it is not a structural measure to free the transportation system from oil, which is indeed frustrating. But this crisis may be different - in the past, we quickly returned to normal after a crisis, with oil and gas supplies flowing again; this time, the partial destruction of the Middle East energy infrastructure may mean that it will take years for energy supplies to recover." An analysis released by the organization this month shows that electric cars have already started to reduce EU oil imports, with nearly 8 million EU electric cars expected to save around 46 million barrels of oil by 2025, equivalent to avoiding nearly 3 billion euros ($3.45 billion) in oil import costs. At the same time, the analysis points out that gasoline car owners in the context of the Middle East conflict are expected to face five times higher risk exposure to rising oil prices than electric car owners. Poliscanova also stated that the growth of electrification in markets such as Vietnam, Thailand, and Indonesia may accelerate the transition away from fossil fuels, supported by affordable models introduced by Chinese carmakers such as Beijing Dynamic Power. Poliscanova said, "We may see some of these economies detach from oil more quickly, which means that what we are still discussing in Europe today, such as biofuels and hybrid cars, looks really foolish and detached from reality." A spokesperson for the European Commission declined to comment on this.