ASX lithium shares are surging across the board on Friday.
Heavyweights including Galaxy Resources Ltd (ASX: GXY) and Orocobre Ltd (ASX: ORE) are both rallying into record territory, up 6.44% and 6.27% respectively.
Unfortunately for Pilbara Minerals Ltd (ASX: PLS), its shares have been suspended, pending the outcome of a court hearing after the company failed to disclose the issuance of new shares.
Elsewhere, emerging lithium players and explorers including Piedmont Lithium Ltd (ASX: PLL) and Liontown Resources Ltd (ASX: LTR) are also trading higher, up 1.36% and 8.88% respectively.
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What's driving ASX lithium shares to new highs?
There has been a lot of hype around the lithium sector, driven by the rising popularity of electric vehicles and the global focus on decarbonisation.
On Friday, Reuters reported that the "White House has told US automakers it wants them to back a voluntary pledge of at least 40% of new vehicles sales being electric by 2030 as it works to reduce greenhouse gas pollution". Yet another possible tailwind for ASX lithium shares.
According to the International Energy Agency (IEA), a record 3 million new electric cars were registered in 2020, a 41% increase from the previous year.
Encouragingly, the IEA cited that electric car sales in the first quarter of 2021 have lifted "nearly two and a half times their level in the same period a year earlier".
Looking ahead, the IEA believes the electric vehicle industry is poised for significant growth over the coming decade.
"Based on current trends and policies, it projects the number of electric cars, vans, heavy trucks and buses on the road worldwide to reach 145 million by 2030. But the global fleet could reach 230 million if governments accelerate efforts to reach international climate and energy goals".
Lithium prices rally to 2-year highs
Both ASX lithium shares and lithium prices are making a comeback after a two-year bear market between 2018 to 2020 where prices tumbled more than 70%.
Orocobre released its June quarterly results on 22 July, where it highlighted that lithium prices have increased by nearly 170% over the last nine months.
The company was receiving an average realised price of US$8,376/tonnes, up 45% quarter-on-quarter.
A recent update from Fastmarkets said that "lithium prices in China domestic market rise amid consumer restocking activity" and "European and US prices remain largely stable, with technical-grade lithium hydroxide narrowing upward slightly".
