Oil Shock in the Market Challenges the Shift to Renewables

March 11, 2020

While the recent oil crash and coronavirus outbreak have plunged financial markets into panic, the consequences could be even more severe for the green energy sector. According to analysts, lower oil costs may curb demand for electric vehicles, as well as investment in renewable energy sectors around the world.

“Cheap petrol is likely to make electric vehicles less attractive to consumers, at least in the short term. The global electric vehicle market had already suffered a slowdown last year because of weaker demand in China and the Americas. It is a picture that the spread of coronavirus risks exacerbating as the global economy stumbles.”

This situation will be a test of the climate commitments made by various countries and private organizations, according to Fatih Birol, head of the International Energy Agency. He went on to say:

“Observers will be quick to notice if governments’ and companies’ emphasis on the transition dies down when market conditions become more challenging.”

Maintaining radical environmentalist goals is far easier when it is financially viable. If history is any indication, these promises are unlikely to withstand current stressors on global financial markets.

The elite eco-left cannot grasp that turbulent markets and cheap oil prices will disincentivize average American households’ transition to cleaner energy. It is simply illogical to expect everyday citizens to ignore lower oil prices.