As the price per kilowatt-hour of electric vehicle batteries falls below the price of a barrel of crude oil, debate in the European Union over easing restrictions on internal combustion engine cars is again drawing attention. The two prices reflect storage capacity and a crude trading unit, respectively, so they are not an indicator for directly comparing vehicle economics.

An opinion piece by Lucien Mathieu (뤼시앙 마티외) of the European Federation for Transport and Environment (T&E), published on Cleantechnica on Oct. 26, said the global average battery price this year fell to $105 per kWh, or about 139,000 won. International oil prices have topped $105 a barrel over the past 3 weeks.

In 2022, international oil prices surged to $120 a barrel, or about 158,900 won, after Russia's invasion of Ukraine. Batteries were priced at $170 per kWh, or about 225,000 won. Battery prices fell about 38 percent over 4 years, while oil surged again on supply instability stemming from Middle East conflict.

"Batteries can lower prices through mass production and technological improvements, but oil is vulnerable to geopolitical shocks," Mathieu said. He also stressed that unlike internal combustion engine vehicles, which keep consuming fuel over their lifetime, electric vehicle batteries can be reused repeatedly and recycled.

T&E estimated that high oil prices this year generated about 55 billion euros in additional costs for European passenger car users, or about 81.3 trillion won, and 220 euros a year per vehicle, or about 325,200 won. It presented the driving energy cost of electric vehicles as, on average, 2 to 3 times lower than for gasoline and diesel cars.

In this situation, the EU is discussing easing its 2035 target to cut carbon dioxide emissions from new cars. The European Commission proposed an amendment last December to lower the target to 90 percent from 100 percent and allow offsets through alternative fuels and other measures. Major political groups in the European Parliament also moved toward a provisional agreement this month, but final legislation has not been confirmed.

The market is seeing rising EV sales. The International Council on Clean Transportation (ICCT) said new battery electric vehicle registrations in September rose 108 percent from a year earlier in France and 95 percent in Germany. Mathieu argued that policy consistency on electrification must be maintained to strengthen the competitiveness of Europe's auto and battery industries.