S&P/ASX 200 Index (ASX: XJO) lithium shares soared today amid the release of a report magnifying the risks of climate change. The report looks set to recharge the global push towards renewable energy.
Shares in both Galaxy Resources Limited (ASX: GXY) and Orocobre Limited (ASX: ORE) finished the day trading more than 8% higher than their previous closing prices. But it was Pilbara Minerals Ltd (ASX: PLS) who led the pack. Its share price gained 10.95% on Tuesday.
And while it's not part of the ASX 200, fan favourite Vulcan Energy Resources (ASX: VUL) shares also gained 6.94%.
It's difficult to say what caused the gains.
However, they might have been tied to renewed interest in fighting climate change, driven by a worrying report out of the Intergovernmental Panel on Climate Change (IPCC). Or, perhaps, by JPMorgan's enthusiasm for lithium.
Let's take a closer look at what might be making the market excited about ASX 200 lithium shares.
What drove ASX 200 lithium shares higher on Tuesday?
IPCC report
First off the bat is the report released by the IPCC today that United Nations secretary-general António Guterres described as "a code red for humanity".
The report found in order to limit global warming to 1.5 degrees, we need to reduce our use of fossil fuels.
It also found Australia is already affected by climate change. Our shorelines are eroding and our fire seasons are becoming more deadly. These trends are set to worsen if carbon emissions aren't limited, the report found.
Of course, that may have pushed the conversation towards topics like electric vehicles and lithium-ion battery power.
Lithium is crucial in the push for renewable energy storage. To many, it also presents a way of lessening the world's reliance on fossil fuels.
Maybe talk of the future helped push ASX 200 lithium shares higher today.
Bullish on lithium
Additionally, ASX 200 lithium shares may have been boosted by JPMorgan's lithium outlook.
As The Motley Fool Australia reported earlier today, the broker foresees a bright future for lithium producers.
JPMorgan also upped its long-term lithium spodumene price by 31%. It expects it to reach $850 per tonne in the future.
