Elon Musk completely upended the auto industry.
with Tesla (TSLA) – Get Tesla Inc reportThe world’s richest man, the maker of premium electric cars, has sparked a true green revolution in the auto industry, with nearly all automakers pledging to produce less polluting cars within the current decade.Providing more electric models has become (GM) – Get General Motors Corporation Reportford (F) – Get Ford Motor Company ReportVolkswagen (VLKAF) Nissan (National Security Foundation) modern (HYMLF) star (STLA) – Get Stellantis NV reportthe parent company of Fiat Chrysler, and even luxury brands like Ferrari (RACE) – Get Ferrari NV report.
With the recent surge in oil prices and its corollary, rising gas prices at gas stations, this ongoing revolution is just getting its full weight. The new situation has led wealthy countries such as the United States and the European Union to turn again to major oil exporter Saudi Arabia, begging it to produce more oil to reduce the impact on consumers already affected by inflation to levels not seen in decades. The highlight of President Joe Biden’s recent trip to the Middle East was his visit to Saudi Arabia as the midterm elections loomed.
gas used as a weapon
But when he ran against former President Donald Trump, Biden had pledged to treat Saudi Arabia as a “untouchable”, especially since the 2018 assassination of journalist and Saudi regime critic Jamal Khashoggi. Once elected, he declassified a damning report on Saudi Crown Prince Mohammed bin Salman’s responsibility in the murder.
After Moscow’s invasion of Ukraine on February 24, the EU is on Russia’s side, facing Russia’s nightmare. The EU has imposed sanctions on Russia, but finds itself in a bind: Russia supplies the EU with 40 percent of the gas it imports. Russian President Vladimir Putin has used this to give him control over European countries.
Putin has asked “unfriendly” countries in Europe to pay their gas bills in rubles to help him shore up the ruble’s value. Poland, Bulgaria and Finland refused to do so, and Russia cut off their supplies. The EU said it viewed Russia’s actions as a form of extortion.
In March, the EU pledged to cut gas imports from Russia by two-thirds within a year. However, it has been difficult to agree on other measures, such as an outright ban on imports. Germany, Europe’s largest economy, depends on Russia for nearly half of its natural gas supplies.
Oil supplies in many European countries could be squeezed by the Russian import ban. About 80 percent of Lithuania and Finland’s oil came from Russia in November.
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It is against this backdrop that prominent entrepreneurs and investment firms, as well as tech startups, David Sacks and Musk have discussed on Twitter. Sachs started off with a message summarizing the year’s geopolitics. The news was followed by another identical order commenting on a Wall Street Journal article according to which Russia intends to use its natural gas as a weapon against the European economy.
“Lithium batteries are the new oil”
“If this year has proven anything, it’s that there is no security without energy independence,” Sachs wrote on July 13. “In particular, Europeans have learned the hard way.”
That’s when Musk stepped in.
“Sure,” the tech giant agreed. Then he added: “And lithium batteries are the new oil.”
Batteries are ubiquitous in our phones, laptops and cars. Lithium-ion batteries have been the dominant storage technology for many years, and demand is expected to grow tenfold over the next decade.
The advantage of lithium-ion batteries is their very high energy density and high specific energy. In addition, this type of battery is immune to memory effects and its self-discharge is also reduced.
Lithium batteries are popular because they are easy to use, relatively inexpensive, and can be used in most appliances and gadgets. Experts say they are currently the best solution for powering mobile devices (cameras, cell phones) or vehicles (hybrid cars, electric vehicles). They do not require maintenance.
The same expert said that lithium batteries can be charged and discharged quickly. They are lightweight and have a lower environmental impact than disposable batteries.
Asia dominates the consumer battery market, with more than 90% of production taking place in China, South Korea and Japan. Japanese groups Panasonic, South Korea’s LG and Samsung, and Chinese groups CATL, BYD and Greep are major manufacturers of lithium batteries. Tesla is the only non-Asian company between these Asian giants.