Global electric vehicle (EV) sales surged in the second quarter of 2026 after the Middle East crisis disrupted crude supply and drove up oil and fuel prices, according to a report released by the International Energy Agency (IEA) on Thursday.

The IEA's report, titled Electric Car Markets in a Time of Uncertainty, noted that global EV sales had declined in the first quarter of 2026, primarily due to weaker performance in the United States and China.

However, the second quarter brought a sharp rebound, with sales rising 35% compared to the first three months of the year. "The energy crisis sparked by the war in the Middle East brought fuel price volatility back into sharp focus," the IEA said. For consumers, sustained high prices at the pump sharpen the operating-cost advantage that EVs hold over conventional vehicles, as electricity has historically cost less per mile than gasoline.

EV sales in the second quarter reached record-high levels across 50 countries as drivers increasingly opted for electric alternatives amid soaring fuel costs. In major car markets including Brazil, India, Australia, and Vietnam, electric car sales roughly doubled between March and June compared with the same period in 2025. The breadth of the gains — spanning emerging economies across South America, Asia, and the Pacific — signals demand expanding beyond the early-adopter strongholds of China, Europe, and North America. In total, as many as 90 countries registered annual growth in EV sales during the first half of the year.

Thanks to the second-quarter surge, global electric car sales in the first half of 2026 were only slightly lower than in the first half of the previous year, as the jump nearly offset the first-quarter decline.

The IEA now expects EVs to reach a 29% share of total car sales worldwide in 2026 — one percentage point higher than the 28% share projected in its Global EV Outlook 2026 published in May. That earlier report forecast global EV sales of 23 million units for the year, citing rising fuel prices as a key driver encouraging more drivers to switch to electric vehicles. A higher EV share also carries implications for oil demand, as road transport accounts for roughly 45% of global oil consumption.

"Looking ahead, the falls we have seen in battery prices and the potential policy responses to the current global energy crisis are set to provide further momentum in EV markets," IEA Executive Director Fatih Birol said in connection with the May outlook, as cited by the agency in a separate statement. Battery costs, the single largest component of EV pricing, have been declining for over a decade, gradually narrowing the upfront purchase-price gap with internal combustion vehicles.

By Michael Kern for Oilprice.com