News from the Oil, Gas, and Energy Sector — Tuesday, 23 December 2025: Oil at Lows, Hopes for Peace, Gas Market Stable
Current events in the global fuel and energy complex (FEC) as of 23 December 2025 are capturing the attention of investors and market participants with mixed signals. On the diplomatic front, some movement has emerged: negotiations involving the US, EU, and Ukraine instil cautious optimism regarding a potential ceasefire in the protracted conflict. However, no concrete agreements have been reached yet, and the stringent sanctions regime in the energy sector remains intact.
The global oil market continues to be pressured by an oversupply and weakened demand. Benchmark Brent crude prices have dipped to around $60 per barrel – the lowest level since 2021. This indicates a surplus of crude oil in the market. In contrast, the European gas market demonstrates resilience: even amidst peak winter consumption, underground gas storage in the EU is approximately 68% full, while stable supplies of liquefied natural gas (LNG) and pipeline gas keep prices at a significantly lower level than last year's values.
Meanwhile, the global energy transition is gaining momentum. Many countries are setting new records in electricity generation from renewable sources (RES), although traditional coal and gas power plants still play a crucial role in ensuring system reliability. In Russia, following a summer surge in fuel prices, authorities have implemented stringent measures (including extending the ban on the export of petroleum products), which have stabilised the situation in the domestic market. Below is a detailed overview of key news and trends in the oil, gas, power generation, and raw materials sectors as of today.
Oil Prices and OPEC+ Strategy
The oil market continues to see declining prices: Brent crude holds around $60 per barrel, while WTI is approximately $55, marking the lowest level in nearly four years. Investors note that a combination of fundamental factors prevents prices from rising – on the contrary, it supports a bearish trend.
- Increasing Supply: The rise in output from both OPEC+ countries and independent producers has led to excessive oil volumes. Since spring 2025, the total production from OPEC+ countries has increased by almost 3 million barrels per day, while other exporters have also reached record levels, creating a surplus of crude oil in the market.
- Hopes for Peace: Progress in negotiations aimed at resolving the situation in Ukraine has fostered expectations of eased sanctions and the complete return of Russian oil volumes to the global market. This factor further weighs on prices, impacting market expectations.
- OPEC+'s Policy: After several months of gradual production increases, OPEC+ participants decided to halt further supply growth in Q1 2026 to prevent overproduction. At the December meeting, the alliance only agreed to a symbolic quota increase (+137 thousand barrels/day), indicating a readiness to act based on market conditions. Key exporters express their commitment to market stability and are willing to reduce output again if prices drop below acceptable levels (around $50 per barrel).
The cumulative impact of these factors keeps the global oil market in a state of moderate surplus. Geopolitical incidents and new restrictions currently lead to only short-term price fluctuations, not altering the overall downward trend. Market participants are awaiting new signals – both from the progress of diplomatic efforts and the actions of OPEC+ – that could change the risk balance for oil prices.
Natural Gas and LNG Markets
The European gas market has entered the winter season with relative confidence. Gas storage across the EU is filled to more than two-thirds of capacity, minimising the risk of shortages even during peak demand periods. Active LNG imports have compensated for nearly complete halts in direct pipeline supplies from Russia, stabilising gas prices at levels significantly lower than the crisis peaks of 2022, thereby alleviating pressure on industry and households.
- Record LNG Imports: In 2025, Europe imported approximately 284 billion cubic metres of liquefied gas – a historic high. The United States emerged as the key supplier (accounting for up to 60% of the total), with significant shipments also coming from Qatar, Africa, and other regions.
- Phasing Out Russian Gas: The European Union is formalising plans to completely cease importing Russian gas by 2027. Starting from early 2026, a ban on purchasing Russian LNG on the spot market will come into effect, forcing EU countries to fully pivot to alternative sources of supply.
On a global scale, gas demand remains stable primarily due to Asian markets, but competition among suppliers is intensifying. Countries in the Middle East and North Africa are actively investing in new LNG projects, aiming to carve out a niche in the growing market. At the same time, expanding gas exports from the US and Australia result in an oversupplied market, keeping global prices within moderate bounds.
Renewable Energy: Record Growth
The year 2025 has marked a significant milestone for renewable energy. An unprecedented introduction of new solar and wind generation capacities has been observed worldwide. According to industry reports, during the first half of 2025, the volumes of new solar and wind power plants increased by more than 60% compared to the same period last year. For the first time in global history, electricity generation from RES surpassed that from coal power plants (on a half-year basis). Global investments in "clean" energy in 2025 reached approximately $2 trillion; however, even these record growth rates are not sufficient to meet climate targets — further investments and upgrades in electrical networks are needed.
China stands out as a success story, becoming the driving force in the energy transition. By introducing hundreds of gigawatts of new solar and wind capacity, China managed to contain CO2 emissions in 2025 despite rising energy consumption. China's experience demonstrates that substantial investments in RES can simultaneously satisfy growing electricity demand and reduce the carbon footprint of the economy.
Coal Sector: Peak Demand
Global coal demand reached a historical maximum in 2025, although its growth rate has virtually flattened. According to the International Energy Agency (IEA), global coal consumption increased by only 0.5% — to approximately 8.85 billion tonnes, marking a record volume. A prolonged plateau phase is anticipated, followed by a gradual decline by 2030. Coal remains the largest fuel for electricity generation globally, but its share is beginning to decrease due to competition from alternative energy sources.
- China: In the largest consumer of coal, China (accounting for about half of global demand), consumption stabilised in 2025. A gradual decline in coal use is expected by the end of the decade as new RES capacities come online.
- India: Thanks to a record hydropower generation in 2025, India experienced a temporary reduction in coal consumption for the first time in many years.
- USA: In the United States, a slight increase in coal usage has been noted due to high gas prices and government measures supporting the continued operation of coal-fired power plants.
Thus, global coal demand appears to have peaked. The future dynamics in the sector will depend on the pace of the energy transition in major economies. With the accelerated growth of RES and other clean sources, a gradual phasing out of coal from the fuel mix is expected.
Refined Products and Processing: High Margins
The refined products market is demonstrating high profitability for refineries (REFs) by the end of 2025. Global refining margin indicators (the so-called "crack spreads") have surged to multi-year highs. This is due to several factors: sanctions reducing the export of refined products from Russia, the closure for maintenance of several major refineries in Europe and the US, and delays in bringing new refining capacities online in the Middle East and Africa. The European diesel market remains particularly profitable: diesel refining margins in Europe have risen to levels not seen since 2023, indicating a structural deficit in this type of fuel.
In response, refiners are ramping up capacity utilisation, aiming to capitalise on the favourable market conditions. Major oil companies have reported sharp increases in profits in the downstream segment (refining and marketing) in recent quarters, thanks to high gasoline and diesel prices. According to the IEA, European refineries increased crude oil processing by several hundred thousand barrels per day in the second half of 2025 due to record margin levels. Analysts note that without the introduction of new capacities in Europe and North America, fuel shortages may persist, keeping high margins intact into 2026.
Geopolitics and Sanctions: Impact on Markets
Geopolitical factors continue to significantly influence commodity markets. Sanction regimes concerning the oil and gas sector remain in place, and recent events demonstrate strict compliance with restrictions. In December, the US intercepted a tanker carrying oil off the coast of Venezuela, halting attempts to circumvent sanctions. Concurrently, Washington intensified pressure on the "shadow fleet" transporting Iranian oil: despite new prohibitions, exports from Iran in 2025 reached their highest level in recent years, with active shipments to Asia. Russian oil and refined product exports have been entirely reoriented toward alternative markets (China, India, the Middle East), yet price restrictions and the EU embargo continue to cut into sector revenues. The European Union is also tightening restrictive measures: in addition to the current oil embargo, a ban on the import of Russian LNG will take effect at the beginning of 2026 – thereby Europe is concluding its withdrawal from Russian energy sources.
Against this backdrop, market participants are factoring in increased geopolitical risks and price premiums into their forecasts. Any signals of potential easing of the sanctions regime or diplomatic progress could significantly affect investor sentiment and price dynamics. For now, oil and gas companies are adapting to the new structure of flows and prices – diversifying logistics and redirecting to regions less susceptible to sanction pressures.
Investments and Projects: Looking Ahead
Despite market volatility, significant investments continue in the energy sector. Countries in the Middle East are ramping up investments in oil and gas production: national companies are expanding production capacities to maintain their market share in the long term. Specifically, in the UAE, the state corporation ADNOC secured financing of around $11 billion for gas production enhancement projects. At the same time, leading exporters like Qatar and the US are implementing programmes to expand LNG terminals, anticipating further growth in global demand for "blue fuel".
Substantial funds are also directed towards "green" energy. Global investments in renewable sources are growing at an accelerated pace: corporations are investing capital in the construction of solar and wind farms, as well as energy storage facilities. However, achieving decarbonisation goals will require even greater efforts and resources. New technologies – such as hydrogen energy and industrial energy storage – are becoming increasingly attractive investment directions. It is expected that 2026 will bring new mergers and acquisitions in the sector, as well as the launch of major projects in both the traditional oil and gas segment and the RES sphere.
