Oil is no longer an energy security challenge as critical minerals take center stage, Saudi minister says
Aerial view of brine ponds and processing areas of the lithium mine of the Chilean company SQM (Sociedad Quimica Minera) in the Atacama Desert, Calama, Chile, on Sept. 12, 2022.
Martin Bernetti | Afp | Getty Images
RIYADH, Saudi Arabia – The energy minister of Saudi Arabia – the Gulf kingdom whose wealth and power rests disproportionately on its vast petroleum reserves – believes that oil is no longer an energy security challenge.
Instead, he said, the coming battle will be for entirely different materials buried under the ground: critical minerals.
“Oil is no longer an energy security challenge – it’s going to be gas, electricity, predominantly minerals,” Saudi Energy Minister Abdulaziz bin Salman told attendees at the annual Future Minerals Forum in Riyadh.
“Today some of these countries, they have, as a country, 50% of the ownership of some of these required minerals and critical minerals … countries are racing to access critical minerals and secure their own supply chain. Rushing to secure access to resources will ultimately lead to higher emissions, higher metals costs and higher energy prices.”
The energy minister was referring to minerals critical to the energy transition and advanced technologies – including lithium, cobalt, nickel, graphite, manganese and other rare earth elements crucial for making things like electric vehicles, batteries, renewable energy technology, computers, and household goods.
China currently controls roughly 60% of the world’s production of rare earth minerals and materials, according to a recent report by Rice University’s Baker Institute for Public Policy. That has many countries, particularly those in the West, concerned, as these resources become ever more important to national security and economic stability.
“More AI [artificial intelligence] and data centers means more energy,” Bin Salman said. “You’ll have AI, data centers, mining, crypto mining … can you imagine what will happen to energy demand? Can you imagine the race between mining to create energy, and energy to create mining and the growth of these economies?” the energy minister asked.
“I really don’t like the idea of being the energy minister at that time.”
Electricity demand around the world is surging, fueled by the rising demand for data centers required to power AI, factories, electric vehicles, and hotter and longer summers. A recent energy department memo cited in numerous press reports projected that U.S. power grids could see as much as 25 gigawatts of new data center demand by 2030.
Critical minerals and rare earth metals are also essential for renewable technology like solar panels and wind turbines, which are central to many countries’ efforts toward an energy transition away from fossil fuels. China refines 95% of the world’s manganese — a chemical element used in batteries and steel manufacturing — despite mining less than 10% of its global supply.
Saudi Arabia on Wednesday announced it is working on a $100 billion mining investment as it aims to become a global hub for both mining and minerals extraction and processing. The kingdom plans to significantly expand its exploration for lithium within its own borders, as well as for other critical minerals.
Boosting its minerals sector and investing in a domestic supply chain is part of Saudi Arabia’s Vision 2030 mission to diversify its economy away from oil.
EV sales kept up their momentum in December 2024, with incentives playing a big role, according to the latest Cox Automotive’s Kelley Blue Book report.
December’s strong EV sales saw an average transaction price (ATP) of $55,544, which helped push the industry-wide ATP higher, according to Kelley Blue Book. The December ATP for an EV was higher year-over-year by 0.8%, slightly below the industry average, and higher month-over-month by 1.1%. Tesla ATPs were higher year-over-year by 10.5%.
Incentives for EVs remained elevated in December, although they were slightly lower month-over-month at 14.3% of ATP, down from 14.7% in November.
EV incentives were higher by an impressive 41% year-over-year and have been above 12% of ATP for six consecutive months. Strong sales incentives, which averaged more than $6,700 per sale in 2024, were one reason EV sales surpassed 1.3 million units last year, according to Cox Automotive, a new record for volume and share.
(My colleague Jameson Dow reported yesterday, “In 2024, the world sold 3.5 million more EVs than it did in the previous year … This increase is larger than the 3.2 million increase in EV sales from the previous year – meaning that EV sales aren’t just up, but that the rate of growth is itself increasing.”)
Kelley Blue Book estimated that in December, approximately 84,000 vehicles – or 5.6% of total sales – transacted at prices higher than $80,000 – the highest volume ever. KBB lumps gas cars and EVs together into this luxury vehicle category, so this is where Tesla Cybertruck is slotted.
However, Tesla bundles sales figures of Cybertruck with Model S, Model X, and Tesla Semi(!) into a category it calls “other models,” so we don’t know for sure exactly how many Cybertrucks Tesla sold in Q4, much less in December. However, Electrek‘s Fred Lambert estimates between 9,000 and 12,000 Cybertrucks were sold in Q4, and that’s not a stellar sales figure.
What will January bring when it comes to EV ATPs? What about tax credits? Check back in a month and I’ll fill you in.
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Tesla is now claiming that Cybertruck was the ‘best-selling electric pickup in US’ last year despite not even reporting the number of deliveries.
There’s a lot of context needed here.
As we often highlighted, Tesla is sadly one of, if not the most, opaque automakers regarding sales reports.
Tesla doesn’t break down sales per model or even region.
For comparison, here’s Ford’s Q4 2024 sales report compared to Tesla’s:
You could argue that Tesla has fewer models than Ford, and that’s true, but Tesla’s report literally has two lines despite having six different models.
There’s no reason not to offer a complete breakdown like all other automakers other than trying to make it hard to verify the health of each vehicle program.
This has been the case with the Cybertruck. Tesla is bundling its Cybertruck deliveries with Model S, Model X, and Tesla Semi deliveries.
Despite this lack of disclosure, Tesla has been able to claim that the Cybertruck has become “the best-selling electric pickup truck” in the US in 2024:
It very well might be true. Ford disclosed 33,510 F-150 Lightning truck deliveries in the US in 2024 while most estimates are putting Cybertruck deliveries at around 40,000 units.
Those are global deliveries, but Tesla only delivered the Cybertruck in the US, Canada, and Mexico in 2024, and most of the deliveries are believed to be in the US.
However, there’s essential context needed here, as we highlighted in our recent ‘Tesla Cybertruck sales are disastrous‘ article.
First off, Tesla had a backlog of over 1 million reservations for the Cybertruck that it has been building since 2019. This led many to believe Tesla already had years of demand baked in for the truck and that production would be the constraint.
However, based on estimates, again, because Tesla refuses to disclose the data, Cybertruck deliveries were either flat or down in Q4 versus Q3 despite Tesla introducing cheaper versions of the vehicle and ramping up production.
Again, that’s after just about 40,000 deliveries.
Furthermore, with almost 11,000 deliveries in Q4 in the US, Ford more likely than not outsold Cybertruck with the F-150 Lightning in Q4.
Electrek’s Take
Tesla is in damage control here. There’s no doubt that it is having issues selling the Cybertruck.
Inventory is full of Cybertrucks and Tesla is now discounting them and offering free lifetime Supercharging.
Tesla is great at ramping up production, and it’s clear the Cybertruck is not production-constrained anymore. It is demand-constrained despite having over 1 million reservations.
Again, those reservations were made before Tesla unveiled the production version, which happened to have less range and cost significantly more.
The upcoming cheaper single motor version should help with demand, but I have serious doubts Tesla can ramp this program up to more than 100,000 units in the US.
As a reminder, Tesla installed a production capacity of 250,000 units annually and Musk said he could see Tesla selling 500,000 Cybertrucks per year.
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