The global adoption of electric vehicles reached a new milestone in 2025, with worldwide sales surpassing 20 million units for the first time and reducing oil consumption by an estimated 1.7 million barrels per day, according to a new report by the International Energy Agency (IEA).
In its Global EV Outlook 2026, the agency said electric vehicle sales increased by 20 per cent last year, accounting for roughly one-quarter of all new cars sold globally. The IEA projects sales will rise further to 23 million units in 2026, representing about 28 per cent of total vehicle sales worldwide.
The report highlights the growing influence of electric mobility on global energy markets, particularly as the transport sector remains one of the largest consumers of petroleum products.
According to the IEA, the current fleet of electric vehicles displaced approximately 1.7 million barrels of oil per day in 2025. That figure is expected to rise significantly over the next decade, reaching nearly 5 million barrels per day by 2030 as EV adoption expands across both developed and emerging economies.
The findings underscore the long-term implications of the energy transition for oil-producing nations, including Nigeria, where crude oil exports remain a major source of government revenue and foreign exchange earnings.
Among major markets, Europe recorded one of the strongest performances in 2025, with electric vehicle sales rising by more than 30 per cent and accounting for 28 per cent of all new vehicle purchases.
The IEA said elevated oil prices have strengthened the economic case for electric vehicles by increasing fuel cost savings for consumers and businesses.
"The current high oil price environment is drawing consumer attention to the economic benefits of driving EVs," the agency stated, noting that electric vehicles generally have lower operating costs than conventional internal combustion engine vehicles due to their greater energy efficiency.
The report added that recent increases in crude oil prices linked to geopolitical tensions in the Middle East have further improved the cost advantage of electric vehicles in several markets. In the European Union, annual fuel cost savings associated with EV ownership increased by 35 per cent compared with the previous year.
For commercial operators and corporate fleets with high mileage requirements, the savings can be even more substantial, the agency noted.
China maintained its position as the world's largest electric vehicle market in 2025, with EVs accounting for nearly 55 per cent of new car sales despite a moderation in overall growth. The United States, by contrast, recorded relatively stable sales, with electric vehicles representing just under 10 per cent of total vehicle purchases.
Emerging economies continued to play an increasingly important role in global EV adoption. Sales more than doubled across Southeast Asia, where electric vehicles accounted for nearly one-fifth of new vehicle sales, supported by strong demand in Vietnam, Indonesia and Thailand.
The agency said concerns over fuel price volatility and energy security could further accelerate the shift toward electric mobility in many regions.
Although global EV sales declined by 8 per cent year-on-year during the first quarter of 2026 to 3.9 million units, largely due to policy-related slowdowns in China and the United States, the IEA said the broader growth trajectory remains intact.
Preliminary figures for April showed electric vehicles accounting for more than 60 per cent of monthly vehicle sales in China, a record level for the market.
Looking ahead, the IEA expects the global electric vehicle fleet to expand more than sixfold by 2035. China is projected to remain the dominant market, with EVs expected to account for more than 90 per cent of new vehicle sales by that time.
The report also highlighted China's continued dominance across the electric vehicle supply chain. The country accounted for nearly 75 per cent of global EV production in 2025 and supplied about 60 per cent of worldwide electric vehicle sales.
Global EV manufacturing increased by more than 25 per cent to almost 22 million units during the year, while Chinese automakers exported a record 2.5 million electric vehicles.
China also retained a commanding position in battery production, accounting for more than 80 per cent of global battery cell manufacturing capacity and a significant share of critical battery materials.
Despite rapid growth in EV adoption, the IEA said the impact on global power systems is expected to remain manageable. Electricity demand from electric vehicles is projected to exceed 1,500 terawatt-hours by 2035, a sixfold increase from current levels, but would account for only around 4 per cent of total global electricity consumption.