IEA: Seven in Ten Chinese Electric Cars Were Cheaper Than Conventional Rivals in 2025
Price parity in the world's largest auto market is driving EV penetration fast enough to displace an estimated 1.35 million barrels of oil per day.
In the first half of 2026, China's electric vehicle fleet displaced an estimated 34 million tonnes of oil, according to analysis published on Tuesday (2026-08-04). Converted to crude-equivalent volumes, that amounts to around 1.35 million barrels per day, more than 1% of total global oil consumption. Six months at that pace equals roughly 6% of a full year of Chinese crude imports; annualised, the rate would approach 12%.5
The cost dynamic driving this is now on record. The IEA found that 70% of battery-electric cars sold in China in 2025 were already cheaper upfront than the average conventional car, a price threshold crossed nowhere else at that market share. When purchase price falls below the conventional alternative, adoption becomes less dependent on subsidy cycles.
That affordability shows in the penetration data. Electric vehicles reached 53% of Chinese vehicle sales in April 2026, up from 47% a year earlier, Carbon Brief reported on Thursday (2026-06-04). The domestic market is consolidating around EVs at a pace that makes growth rates in other regions look slow by comparison.3
Globally, the IEA's EV Outlook published on Wednesday (2026-05-20) projected 23 million electric car sales in 2026, nearly 30% of all cars sold worldwide. Last year, global EV sales topped 20 million, a 20% jump year-on-year, with one in four new cars sold globally being electric and around 40 countries recording EV market shares above 10%.1,2 Chinese automakers supplied roughly 60% of electric cars sold globally in 2025, the IEA said, while European and North American manufacturers each accounted for about 15% of sales.1
Chinese producers are extending that manufacturing lead into export markets. In April 2026, global exports of Chinese EVs hit a record $9.4 billion, according to Ember's analysis of Chinese customs data. Africa imported around 44,000 Chinese EVs in 2025, a 130% jump from the year before, according to Chinese Commerce Ministry data.4
ICE Brent crude front-month traded at $80.22 per barrel as of 12:04 UTC on Thursday (2026-08-06). Through most of 2026, crude markets have framed the China energy story through Hormuz supply risk, treating EV demand erosion as a slower-moving force. At 1.35 million barrels per day and growing, that separation is becoming harder to maintain.
An estimated 45 to 50% of Chinese crude imports normally transit the Strait of Hormuz. In 2025, nearly 15 million barrels per day of crude passed through the strait, with China and India together receiving 44% of the flow. EV adoption reduces the absolute volume China needs to import, though the oilprice.com analysis is explicit that the 1.35 million barrel per day figure does not subtract directly from China's import bill: road fuel is one slice of a demand structure that includes petrochemicals, aviation and industrial energy.5
But Sinopec, the state-owned oil major, reported oil product sales up 4.8% in the first quarter of 2026 — a sign that overall petroleum demand remains supported even as the EV fleet displaces road fuel at the headline rate. Apparent oil product consumption rose 5.5% in January and February before falling 0.3% in March, which Carbon Brief attributed to both the price surge and the distorting late timing of Chinese New Year.3
Global EV sales fell 8% in the first quarter of 2026 following policy shifts in China and the United States, the IEA reported, before China's April market share moved back above 50%. The durability of that recovery, and how Chinese EV penetration performs through the back half of 2026, will shape how close the annualised 12% import displacement threshold gets by December.1,35