The ongoing crisis in Ukraine has seen a hike in energy prices, as sanctions are imposed on Russian oil and gas companies – but electric vehicles (EVs) seem to be the next market to take a hit.
Nickel is a critical component in EV batteries and has seen its price rocket by 250% in the last two days.
This is due to Russian exploits in Ukraine, as Russia is one of the largest producers of the element worldwide. Estimations that sanctions may be imposed on nickel mining next, have led to prices going through the roof.
The price now sits at $100,000 (£76k) per metric tonne on the London Metal Exchange, leading to a trading halt.
Morgan Stanley released a report that the changes to the Nickel market will see the input costs of making an EV rise by $1,000 (£763).
The report questions whether it will be possible to make the amount of EVs being touted by manufacturers such as Ford, who have committed to making two million each year by 2026.
It claims that without the Russian market, there is not enough infrastructure in place to meet the demands that building this amount of EVs will require and suggests a heavier focus on lithium-ion batteries, however it does accept that these are less efficient than nickel ones.
While the cost of nickel is so high, the study projects a huge stalling in EV production, until either more mining operations are set up globally or the price plateaus.