Impact of EV Adoption on Crude Oil Refining and Consumption: Case Studies in California and Norway

Abstract: This work traces the relationship between electric vehicle adoption and crude oil refining in California and Norway. As sustainable technologies (such as EVs) gain momentum as a possible means to reduce emissions and protect the environment, it is important to evaluate the efficacy and unintentional impacts of such technologies on existing resources.

We have chosen the cases of Norway and California as both entities show high rates of EV adoption (California has the highest EV market share in the United States, and Norway’s roads now have more electric cars than ICE cars) while simultaneously producing and exporting oil.
Global trends show a gradual slowing in oil demand growth, along with almost exponential
growth of the market share of electric vehicles.

We found a slight inverse relationship between the demand for gasoline and the sale of EVs in the case of California. In the case of Norway, there seems to be a complex relationship between these variables. While EV sales continue to grow every year, consumption has been almost constant since 1980. Production peaked in the 1990s, with a sustained drop in the 2000s that preceded the rise of EV sales in the 2010s. This phenomenon might be explained by the decline in Norwegian oil field discovery. Interestingly, the data seems to show that Norway is not stockpiling crude oil for future use.

While previous studies have analysed crude oil consumption in relation to EV sales, in this study, we are also analysing crude oil refining. By tracing the relationship between new EV sales and the volume of gasoline refined and consumed, we hope to determine the nature of the impact that the increasing adoption of EVs has on the oil industry. If it does, in fact, result in reduced crude oil refining, we can conclude that electric vehicles are succeeding in diverting demand away from fossil fuels in transportation sector.