Goldman Sachs: EV Surge Could Cut Oil Demand 320,000 Barrels Daily by 2027

Published by James Harris on June 22, 2026June 22, 2026

Goldman Sachs put a number on something oil markets have been slow to price: accelerating EV adoption, turbocharged by Hormuz-linked fuel price spikes, could cut global oil demand by up to 320,000 barrels per day by the end of 2027.

The bank’s June 21 research note lays out two scenarios, both converging on meaningful demand destruction. The more aggressive “Persistent Acceleration” case assumes EV market share continues growing at the pace seen between February and May 2026, landing at a 320,000 barrel-per-day reduction. The conservative “Temporary Acceleration” case, where adoption simply holds at May 2026 levels rather than accelerating further, still produces a 130,000 barrel-per-day drop. China is doing most of the work, accounting for more than 60% of the recent rise in global EV market share, but the effect is broader than passenger cars. Goldman’s analysts flag that two- and three-wheeled electric vehicles dominate sales in India, Vietnam, and China, each displacing roughly a third to half the fuel a passenger car EV would, which amplifies the aggregate demand impact considerably. Twelve of the world’s 15 largest EV markets saw rising adoption rates during that same February-to-May window.

The Hormuz disruption, intended as a supply shock, may have inadvertently accelerated the structural demand shift it was supposed to benefit from.

Goldman analyst Alexandra Paulus noted that elevated fuel prices linked to Hormuz supply disruptions likely pushed consumers toward EVs, particularly in China where gasoline demand has already dropped sharply. Retail gasoline sales in China fell more than 20% year-over-year in April. Western Europe saw an average 8% annual decline in retail car-fuel volumes the same month. Goldman now ties these pressures to a potential slide in Brent crude into the mid-$50s per barrel by late 2027, a significant revision from its current Q4 2026 forecast of $90 per barrel. For oil-linked economies and the producers who have already been routing supply through alternative channels, a $30-plus per barrel repricing over 18 months is not a rounding error. The bank sees roughly a $10-per-barrel drop if demand weakness in China and Europe persists, and that estimate does not yet fully account for the multiplier effect from two- and three-wheelers. For rate-sensitive markets, oil as an accelerant to inflation expectations cuts both ways: lower oil structurally reduces one of the inputs that has kept rate-cut timelines pushed out.

The International Energy Agency projects EVs will account for half of all new car sales globally by 2035 even without additional policy support. Goldman’s scenarios suggest the market may be moving faster than that baseline assumes, and that below benchmark prices for regional crude grades could become the norm rather than a temporary dislocation well before that decade-end target arrives.