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The Tesla Effect: Why EVs will take a big bite out of oil demand
The newly defined “Tesla Effect” is producing remarkable consequences. Tesla electric vehicles (EVs) have changed the way that people all over the globe now think about transportation, the place of zero tailpipe emissions, and an accelerated agenda for sustainable energy. One “Tesla Effect” is that the International Energy Agency last month forecast that global gasoline demand has all but peaked because of more efficient cars and the spread of EVs.
Thank you, Tesla.
As a small Silicon Valley startup, Tesla Motors began with a line of luxury electric sports cars that could reliably produce more than 200 miles on a single charge. Due to the wide acclaim and demand it received for its cars, Tesla was able to repay a 2010 loan from the U.S. Department of Energy a full nine years early. Their manufacturing facility in California became the largest auto industry employer in California, and Tesla was soon spreading its mission around the globe. It has achieved success beyond any expectations — except that, perhaps, of CEO Elon Musk — and has prompted other major automakers to accelerate work on their own electric vehicles in order to maintain currency in the market.
And now, while EVs represent less than 1 percent of total vehicle sales, they are predicted to soar in popularity around 2025. That’s when many governments around the globe, including Athens, Madrid, Mexico City, and Paris, have pledged to phase out diesel vehicles in a battle against pollution. These promises, known as “intended nationally determined contributions,” will have significant consequences of their own over the decade that will follow. By 2035, EVs may remove 1 million to 2 million barrels a day of oil demand from the market.
“Anything that reduces the demand for transportation has an impact on the oil market,” Alan Gelder, vice president of refining, chemicals, and oils markets at Wood Mackenzie, said in an interview in London. “The question is how big is it going to be and what’s the time frame.”
Model S and Model X vehicles off the production line seen via aerial drone shot of Tesla factory
Electric cars are displacing about 50,000 barrels a day of demand now, according to the oil industry consultant, Wood Mackenzie, which promotes itself to potential customers as “embedded in the industry, with more than four decades building relationships, improving performance and keeping you ahead of the competition.” To placate nervous clients, Wood Mackenzie says that it does expect total oil demand to keep growing for decades, driven by shipping, trucking, aviation, and petrochemical industries. That’s more conservative than Bloomberg New Energy Finance’s forecast for EVs to displace about 8 million barrels a day of demand by 2035.
Tesla alone won’t be able to supply enough EVs if demand really takes off, Gelder said. Major automakers including Volkswagen AG and Ford Motor Co. will need to produce them on a larger scale. “At the moment they can’t, and changing manufacturing lines takes time.”
Gelder continued his argument by stating that regulation and government subsidies alone won’t be enough to spark a boom in EVs. Consumers, he insisted, will need to believe that EVs are preferred for a variety of reasons. “If there’s a technology revolution, so battery technology gets cheaper and EVs don’t need a subsidy, then it comes down to consumer preference. If the consumers like something, it’ll switch far faster.”
If the global response to Tesla is any indication, EVs are not only here to stay: they’ll be the preferred individual mode of transportation of the future.
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Tesla Robotaxi appears to be heading to a new U.S. city
Things are expanding for Robotaxi, but the big sign that it is really moving along greatly will be with the expansion to a new city. Tesla has not gone outside of Austin or the Bay Area as of yet, and launching in a new city will be a great indicator of progress.
Tesla Robotaxi appears to be heading to a new U.S. city, and although the company has revealed plans to launch in six new metros this year, it has yet to establish a new location outside of Austin and the Bay Area of California, where it has operated since last Summer.
A lot full of Model Y vehicles was spotted in Henderson, a town just north of Las Vegas, but there seems to be more than just this hint indicating that the Sin City will be the next location to offer potentially driverless rides in a Tesla using its Full Self-Driving suite.
These Model Ys are not your typical vehicles, as they are fitted with hardware that is only on Robotaxis: a rear camera washer is the dead giveaway:
🚨 These rear camera washers are only present on Robotaxi vehicles
Maybe Las Vegas is the next city to get the Robotaxi suite 😀 https://t.co/my3da5L4zc pic.twitter.com/jYFQuX1j2E
— TESLARATI (@Teslarati) March 17, 2026
The photos and video of the lot were taken by TheZacher on X, who spotted the Model Y fleet in the Henderson parking lot.
The rear camera washer is the main piece of evidence here that indicates Tesla could be looking to expand Robotaxi to Las Vegas, a major ride-hailing hot spot, as it is one of the biggest tourist attractions in the United States. Ride-sharing is a major industry in Vegas, especially for those who are staying off the Strip.
Tesla has also been extremely transparent that Vegas is on its radar for the Robotaxi fleet, as it revealed last year that it was one of five new U.S. cities that it planned to launch the ride-hailing service in this year.
Tesla confirms Robotaxi is heading to five new cities in the U.S.
The others were Phoenix, Dallas, Houston, and Miami.
Things are expanding for Robotaxi, but the big sign that it is really moving along greatly will be with the expansion to a new city. Tesla has not gone outside of Austin or the Bay Area as of yet, and launching in a new city will be a great indicator of progress.
It will also give Tesla a new benchmark against rival company Waymo, which has operated in Las Vegas for some time.
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Tesla Roadster gets new unveiling date once again
Musk announced last year that the unveiling, which initially happened back in 2018, would take place on April Fool’s Day. Initial deliveries at the 2018 event were slotted for 2020, but delays in the project, as well as prioritization of other things, continued to push the Roadster back.
The Tesla Roadster is perhaps the most anticipated vehicle in the company’s history, but those who have been waiting anxiously for it will have to push their timelines back once again.
Tesla CEO Elon Musk has revealed that the company is once again pushing back the unveiling event that was originally planned for April 1. It will now take place “probably in late April.”
True.
New Roadster unveil probably in late April. https://t.co/NShZxpK5cI
— Elon Musk (@elonmusk) March 17, 2026
Musk announced last year that the unveiling, which initially happened back in 2018, would take place on April Fool’s Day. Initial deliveries at the 2018 event were slotted for 2020, but delays in the project, as well as prioritization of other things, continued to push the Roadster back.
There has been so much hype about the Roadster that people are right to be excited about the prospect of its existence.
Musk’s most recent rumblings about the vehicle came last Fall, when he appeared on the Joe Rogan Experience podcast, where he once again hinted the car would be able to hover for a short period.
He said:
“Whether it’s good or bad, it will be unforgettable. My friend Peter Thiel once reflected that the future was supposed to have flying cars, but we don’t have flying cars. I think if Peter wants a flying car, he should be able to buy one…I think it has a shot at being the most memorable product unveiling ever. [It will be unveiled] hopefully before the end of the year. You know, we need to make sure that it works. This is some crazy technology in this car. Let’s just put it this way: if you took all the James Bond cars and combined them, it’s crazier than that.”
Additionally, he said the vehicle would not be something that would prioritize safety. Musk said that “If safety is your number one goal, do not buy the Roadster.” It’s made for speed and excitement, not for grocery-getting.
Elon Musk just said some crazy stuff about the Tesla Roadster
As the April 1 unveiling event that was originally planned was nearing without any communication to fans, media, or anyone who would potentially be in attendance, it seemed to be pretty obvious that Tesla was not ready to pull the trigger on the event quite yet.
There could be some last-minute things to finalize, or it could be something else. One thing is for certain, though: we are not super surprised that things were moved back.
Tesla has definitely been putting some things in motion for the Roadster. A few months back, Tesla started to ramp up hiring for the Roadster, and earlier in March, it submitted a patent application for a new seat design.
Elon Musk
Tesla named by U.S. Gov. in $4.3B battery deal for American-made cells
What began as an open secret in the energy industry was confirmed by the U.S. Department of the Interior on Monday: Tesla is the buyer behind LG Energy Solution’s blockbuster $4.3 billion battery supply agreement.
What began as an open secret in the energy industry is becoming more real after the U.S. Department of the Interior named Tesla as the stakeholder in the LG Energy Solution’s blockbuster $4.3 billion battery supply agreement.
Tesla and LG Energy Solution are expanding their partnership to build a LFP prismatic battery cell manufacturing facility in Lansing, Michigan, launching production in 2027. The announcement, made as part of the Indo-Pacific Energy Security Summit results, ends months of speculation.
“American-made cells will power Tesla’s Megapack 3 energy storage systems produced in Houston, creating a robust domestic battery supply chain.”, notes a press release on the U.S. Department of the Interior website.
Tesla has long utilized China’s Contemporary Amperex Technology Co. (CATL), the world’s largest LFP battery maker, as one of its primary suppliers. That relationship made financial sense for years, considering that Chinese LFP cells were cheap, abundant, and reliable. But with escalated tariffs on Chinese imports and an increasingly growing Tesla Energy business that’s particularly reliant on LFP cells for products including its Megapack battery storage units designed for utilities and large-scale commercial projects.
The announcement of a deepened partnership between LG Energy Solution and Tesla has strategic logic for both parties. For Tesla, it secures a tariff-compliant, domestically produced battery supply for its fast-growing energy division. LGES, now producing LFP batteries in Michigan, becomes the only major supplier currently scaling U.S. production, outpacing rivals like Samsung SDI and SK On. LG Energy Solution’s Lansing plant, formerly known as Ultium Cells 3, was previously operated as a joint venture with General Motors. LGES acquired GM’s stake in May 2025 and now fully owns the site, with a production capacity of 50 GWh per year. LG Energy said the contract includes options to extend the supply period by up to seven years and boost volumes based on further consultations.
For the broader industry, the ripple effects are significant. This deal signals that domestic battery manufacturing can be financially viable and not just aspirational. Utilities, energy developers, and rival automakers will take note as American-made LFP supply becomes a competitive reality rather than a distant promise.
For consumers, the benefits will take time but are real. A more resilient, U.S.-based supply chain means fewer price shocks from trade disputes, more stable Megapack availability for the grid storage projects that reduce electricity costs, and long-term downward pressure on energy storage prices as domestic production scales.
Deliveries are set to begin in 2027 and run through mid-2030, and as grid storage demand accelerates, reliable, US-made battery supply is no longer a future ambition. It is becoming a core requirement of the country’s energy strategy.
Tesla Robotaxi appears to be heading to a new U.S. city
Tesla Roadster gets new unveiling date once again
