Fuel price shock drives electric vehicle rush across Asia-Pacific

Interest in electric vehicles is climbing across Asia-Pacific as fuel prices surge and supplies tighten following disruption in the Strait of Hormuz, through which crude oil bound for Asia typically accounts for up to 80% of shipments.

Shipments of oil and liquefied gas through the waterway have nearly halted since the US-Israeli war on Iran, the world’s biggest oil exporter.

The International Energy Agency has described it as the most substantial supply disruption on record.

With energy costs rising, consumers and businesses are increasingly turning to electric models to reduce running costs and insulate themselves from soaring petrol prices, backed in many markets by government subsidies.

Australia: EV loans double as interest surges

National Australia Bank, the country’s largest lender, reported a 100% increase in EV loans in March, with business enquiries for EV financing up 88%.

“We’re seeing a real surge in interest in EVs from businesses of all sizes, with many keen to take advantage of lower operating costs in the short term and future-proof their fleets in the long term,” said Shane Ditcham, NAB executive for business and private markets.

Searches for electric vehicles on major car-sale websites rose more than 200% over the past month, and more than half of Australians said they would consider purchasing an EV.

Prime Minister Anthony Albanese has ruled out any ban on petrol vehicle sales, saying buyers would not regret switching.

Japan: energy costs shift the mood towards EVs

Analysts say the energy price surge is acting as a tailwind for electric vehicles in Japan, where EVs currently account for less than 2% of car sales.

“Higher petrol and diesel prices are creating an atmosphere that is conducive to EVs,” said Masa Uchiyama, analyst at Daiwa Securities Group.

Government purchase subsidies were raised to as much as ¥1.3 million ($8,144) in January, encouraging more consumers to switch from petrol-powered vehicles.

Toyota Motor and Nissan Motor, along with Tesla, are all expanding their EV line-ups for the Japanese market. Supply chains have nonetheless been severely disrupted by the Hormuz crisis, constraining EV availability in the near term.

South Korea: registrations more than double in March

Electric and hybrid vehicle registrations more than doubled in South Korea in March from a year earlier, driven by higher fuel prices, intensifying competition from Tesla and BYD, and a rush to take advantage of government EV subsidies.

Analysts say sales will accelerate further in the second half of the year.

EVs accounted for just 2% of new car sales in the first half of the year, with supply chains taking a heavy hit from the Hormuz disruption.

New Zealand: biggest sales week since late 2023

More than 1,000 electric vehicles were registered in New Zealand in the week ending 22 March, nearly double the previous week’s figure and the highest weekly total since late 2023, according to Transport Minister Chris Bishop.

A separate study found 58% of New Zealanders are now more inclined to purchase an EV owing to higher fuel costs, with a further 12% saying they would definitely buy one in the near future.

“It’s no secret EVs are set to become increasingly popular, and this has the potential to transform the way we get around,” said Jason Downey, chief executive of Mobility Network.

Chinese brands capitalise on regional momentum

Chinese manufacturers, led by BYD, are well-positioned to benefit from the demand shift.

BYD’s overseas market share more than doubled to 22.7% in the first two months of 2026, from 10% in 2025, as international expansion outpaced a slowing domestic market.

Overall EV exports rose 93% year on year in the first half of the year, while sales of EV-related components increased 38.3%.

In Malaysia, distributor BYD Sime Motors reported an exponential rise in enquiries during March and launched a series of promotions targeting corporate clients, government employees, and retail buyers. At the Bangkok International Motor Show, hundreds queued to test-drive BYD models.

“I have never considered EVs before. Fuel prices have skyrocketed due to the war and the supply chain crisis,” said Gaea Li, a visitor from China test-driving BYD’s Dolphin.

Battery and hybrid models have already accounted for more than half of all vehicle sales in China, according to the China Passenger Car Association.

What comes next?

The pace of EV adoption across the region will depend largely on how long the global oil supply disruption persists, as well as on government policy support, the build-out of charging and battery-swap infrastructure, and the pricing strategies of Chinese manufacturers that have moved quickly into the sector.

A fossil fuel supply shock is accelerating EV uptake across Asia-Pacific, and the players best placed to meet that demand — predominantly Chinese — are already scaling up to do so.

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