The Vulcan Energy Resources Ltd (ASX: VUL) share price is down 21% from its 11 August high of $9.68
Over the same period, the S&P/ASX 200 Materials Index (ASX: XMJ) also swooped lower for a 4.41% loss.
Shares of the battery metals exploration company currently trade for $7.64 each, up 2.4% for the day.
Let's take a closer look at the sector's major developments to learn more about what's going on with the Vulcan Energy share price.
What happened?
Recent developments present a mix of challenges and opportunities for the zero-carbon lithium developer.
One day before the company's share price peaked, Graphene Manufacturing Group Ltd (CVE: GMG) announced its graphene aluminium-ion batteries are a more effective substitute for lithium-based alternatives.
The company gave two reasons: the batteries can reportedly charge 70 times faster and have longer lifespans than lithium-ion batteries.
Then on 17 August, EV and semiconductor factories shut down in China for six days amid a record heatwave in the country, as reported by Stockhead.
However, some positive news emerged during this time, too, including that zero-carbon lithium could trade at a 'green premium' in the future.
The United States also introduced a US$437 billion spending bill, with the vast majority set aside for tackling climate change and a US$7,500 tax credit for consumers who purchase electric vehicles.
Overall, the outlook looks mostly positive for the company and ASX lithium shares in the longer term, but some short-term headwinds have battered the stock in the meantime.
Vulcan Energy share price snapshot
The Vulcan Energy share price is down 27% year to date. Meanwhile, the S&P/ASX 200 Materials Index has lost 8.3% loss over the same period.
The company's current market capitalisation is roughly $1.09 billion.
