Featured # Editorials | 4 years ago

A Shift in Attention to Oil Alternatives

A new commodity has grabbed the attention of manufacturers and investors after the first day of March started off with a rise in oil prices and positive reports for U.S. manufacturing. Lithium carbonate, lesser-known and with scarce data, still hit its biggest ever price surge at the beginning of this year. As a helpful tool in powering electronics, the real reason for investor attraction has come from this commodity’s use in electric and hybrid vehicles. The production of a gigafactory in Nevada for the purpose of harvesting lithium carbonate for all its future potential has boosted price and demand more than expected for this helpful tool that can be seen as an alternative to oil. With a focus on saving the environment, lithium carbonate can be used to power electric vehicles and prevent CO2 emissions from damaging the earth.

With the emergence of home batteries and charging stations, the need for lithium carbonate as an alternative fuel source is on the rise. Especially with its use in the lithium ion battery, the market is set to grow in the next few years. In comparison to oil and gold, lithium carbonate has limited data, yet prices are continuing to rise and transforming into a strong industry with prices expected to grow above $10,000 per ton. Helping to power smartphones and other electronics, the lithium market has the potential to become linked to the consumer electronic market.

As a potential substitute for gasoline, lithium can become the “new gasoline” and take advantage of the reordering of the current oil market. Lithium’s ability to be stored and used as an alternative fuel can potentially revolutionize the future of the car industry. With an increasing number of companies entering into the electric vehicle market, the need for lithium harvest and product manufacturing, such as lithium ion batteries, is only going to continue to raise the price of this commodity.

The future of electric cars and alternative fuels is upon us. With battery powered cars already out in the market, and many more designs in the production phase, the surge in lithium prices could continue. Predictions are positive for 2017 where prices should hit a peak due to and increasing number of companies entering the lithium market and adding to the supply in these coming years. However, this “new gasoline” market should also be looked at with caution. Because the market already hit its all-time high and had its biggest price surge yet, it is possible that a slump is in the near future. Despite positive predictions from some economists, low oil prices and a changing global oil market could temporarily cause consumers to stray away from the new and stick with the source of fuel they know. With battery types, other than lithium based, a possibility for future adoption by the automobile industry, lithium could be passed up for other alternative options. The entrance of multiple alternatives could pose as a risk for the electric vehicle market and shake up pricing and demand.


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