Lithium: The New Oil? Exploring the Global Race for Critical Minerals

Critical Mineral Lithium and its Pivotal Role in the EV Revolution

When Nicholaus Rohleder joined me on camera for the second episode of The Ripple Effect, his “Oxford University” sweater caught my eye—and I had a moment of panic about my own credentials. Not only does Nicholaus have a master’s degree from Oxford, but he’s also collected two more from Penn and Columbia (as one does). Add in his Visiting Fellow role at the National Security Institute and his teaching gig at Penn, where he covers everything from climate tech to artificial intelligence, and it’s clear: this guy might actually know everything.

Critical mineral lithium and its pivotal role in the electric vehicle revolution.

So, naturally, Nicholaus was the perfect person to help unpack lithium—because, as it turns out, there’s more to this critical mineral than just powering your EV or showing up in headlines.

This week, lithium is making waves for its pivotal role in the electric vehicle revolution and its place at the center of geopolitics. From Russia’s seizure of Ukraine’s lithium mines to the U.S. Department of Energy’s billion-dollar loan for Nevada’s Rhyolite Ridge project, lithium is big news. And let’s not forget Europe, where Serbia’s lithium potential has sparked both excitement and regulatory turmoil.

Lithium: Indispensable and Irreplaceable

Nicholaus broke it down: while some substitutions are possible for grid storage, when it comes to electric vehicles, there’s simply no alternative to lithium. Tesla, Toyota, and GM all rely on this critical mineral, and as demand for EVs grows, lithium’s importance will only intensify.

Today, over 80% of lithium is used in batteries—up from just 30% a decade ago—and the market is projected to grow from $30 billion to $130 billion by 2032. Whether it’s hard rock lithium from Australia or brine from Chile and Argentina, the supply chain is tailored to meet this burgeoning demand.

Geopolitical Tensions and Global Competition

The race for lithium is also a story of geopolitics. Russia’s control over Ukraine’s lithium deposits underscores the mineral’s strategic significance, while Europe grapples with the challenge of reducing reliance on China for processing. Serbia’s lithium reserves, once seen as a solution for European independence, now face regulatory setbacks and public opposition.

Meanwhile, in North America, the U.S. and Canada are stepping up. The U.S. government’s funding for domestic lithium projects and Canada’s push for innovative Direct Lithium Extraction (DLE) technologies signal a shift toward building resilient, sustainable supply chains.

The Ripple Effect

Nicholaus highlighted how the competition for lithium could reshape global alliances. Countries with rich reserves, like Argentina, are emerging as potential key partners for the U.S., while China continues to dominate processing and refining.

However, there’s a catch: mining lithium is water-intensive, and environmental concerns loom large. Innovation, like DLE, offers hope, but permitting challenges and community resistance remain significant hurdles.

One major potential policy shift worth watching is the rumored cancellation of the $7,500 federal tax credit for electric vehicles under the Trump administration. As Nicholaus pointed out, this subsidy has been a key driver of EV adoption in the U.S., making electric vehicles more accessible to consumers. Removing it could drastically alter the trajectory of lithium demand, particularly in North America, where the EV market is still in its infancy. Such a move would ripple through supply chains, potentially stalling domestic lithium projects and leaving the U.S. more reliant on global markets for this critical mineral.

Lithium isn’t just a mineral—it’s a symbol of our times. It bridges clean energy ambitions, geopolitical tensions, and the race for technological dominance. And thanks to Nicholaus’s insights, I now feel a little smarter—or at least better informed—about the forces shaping this global race. As Nicholaus aptly put it, we’re at a critical inflection point. How the U.S., Europe, and other nations navigate the lithium boom will determine not just energy independence but the future of global power dynamics.

What’s your take on lithium? Is it the new oil, or are we still figuring out how to handle its ripple effect?