The Iran conflict — which has disrupted global fuel supplies and intensified economic pressure — is accelerating Asia’s transition to electric vehicles (EVs), according to recent media reports and industry discussions.

The trend was a central theme at the Fastmarkets Asian Battery Raw Materials & Recycling Conference held in Hanoi from April 27 to April 29, where analysts highlighted how oil supply disruptions and rising fuel prices are reshaping regional energy and transportation strategies.

The Strait of Hormuz, a critical artery for global energy markets, supplies 20–30 percent of the world’s oil and about 20 percent of liquefied petroleum gas. Disruptions linked to the Iran war have driven up fuel and processing costs across Asia, triggering inflation, reduced purchasing power, and slower economic growth, according to an International Monetary Fund report.

Rising fuel costs have also affected food supply chains, with higher fertilizer prices increasing risks of food insecurity across parts of the region.

Reuters reported that fuel volatility is pushing consumers toward EV adoption, particularly in countries where gasoline and diesel prices are market-driven. Governments facing fiscal strain from higher crude oil import bills are increasingly introducing EV policies and incentives, even as fuel subsidies remain in place.

Asia is emerging as a global leader in battery raw materials, recycling, and EV manufacturing, according to data presented at the Hanoi conference.

The EV market is expanding rapidly outside China, with strong growth in countries such as Vietnam, Thailand, and India. 

India recorded 2.5 million EV registrations as of March — a 24 percent increase year over year — while Vietnam saw growth of 100–150 percent and Thailand reported a 150 percent surge, according to Reuters.

Nepal recorded one of the highest EV adoption rates globally, with electric vehicles accounting for about 70 percent of new vehicle sales last year, according to the South China Morning Post. The country’s heavy reliance on fuel imports from India has made it particularly vulnerable to oil price shocks.

Will Symons, head of Deloitte Asia Pacific’s sustainability practice, said the shift reflects a broader economic calculation.

“This is why countries like Nepal, Thailand, Vietnam et cetera are leading the world in EV uptake,” he told SCMP. 

Analysts also point to efforts to reduce dependence on China-led supply chains as another driver of growth in Asia’s EV sector.

“From Indonesia’s nickel strength to India and Vietnam’s lithium expansion, and Korea and Japan’s dominance in cathode and midstream technologies, the region is surging with innovation and investment,” the conference readout said.

Industry observers expect continued growth in electric two- and three-wheelers, along with rapid deployment of battery energy storage systems (BESS) across Southeast Asia and South Asia, Reuters reported.

In India, demand for electric two-wheelers has surged. Registrations rose 58.9 percent in March, with 177,485 units sold compared with 111,680 in February, according to New Delhi Television.

As global oil supply chains remain under strain, analysts say structural changes in energy consumption are becoming more likely.

Research from energy think tank Ember shows that Iran exported more than 2.4 million barrels of oil per day through the Strait of Hormuz before the conflict. By comparison, EV adoption reduced global oil demand by about 1.7 million barrels per day last year.

Daan Walter, a principal researcher at Ember, said current conditions differ sharply from past energy crises.

“Electric vehicles are increasingly cost-competitive with petrol cars. Oil volatility means EVs are a common-sense choice for countries wishing to insulate themselves from future shocks,” he said.

Oil price volatility also carries significant macroeconomic costs. An Ember analysis estimates that every $10-per-barrel increase raises the global import bill by roughly $160 billion annually.

The group said global savings could exceed $600 billion per year if oil use in transportation is replaced by EVs.