Energy Sector News for Sunday, December 7, 2025: Oil and Gas Prices, OPEC+ Decisions, Sanction Pressure on the Russian Energy Sector, Fuel Situation in Russia, the Role of the EU, US, China, and India, Market Trends for Coal, Renewable Energy Sources, and Oil Products — Analytical Review for Investors and Global Energy Sector Players.
Key events in the global fuel and energy sector as of December 7, 2025 demonstrate that world markets continue to balance between an oversupply of resources and geopolitical risks. Oil prices remain around the lowest levels in the past two years: Brent crude is trading at approximately $62–64 per barrel, while American WTI is around $59. These levels are significantly lower than mid-year figures, as the market is pressured by increased supply amid relatively stable demand and cautious optimism regarding potential progress in peace talks about Ukraine. The European gas market is entering winter without signs of deficit: underground gas storage in the EU remains filled to about 75–80%, while wholesale prices (TTF hub) are holding steady around €28–30 per MWh, which is significantly lower than the extreme peaks of previous years. Record LNG supplies and mild weather at the beginning of the season ensure stability and relatively low gas prices.
Meanwhile, geopolitical tension surrounding energy markets persists. Western countries are not easing the sanction pressure on the Russian oil and gas sector: the European Union is legally formalizing a complete rejection of imports of Russian pipeline gas by 2027 and is aiming to accelerate cuts in oil purchases from Russia. Efforts by diplomats to achieve a breakthrough in conflict resolution have yet to produce tangible results, although the US and Ukraine held consultations on a peace plan in early December. Energy supplies remain under threat due to potential military incidents; however, the global market is currently able to compensate for local disruptions. Within Russia, authorities are extending emergency measures to stabilize the fuel market following a fall gasoline and diesel shortage in autumn — oil product exports remain tightly restricted to saturate the domestic market. At the same time, the global energy sector is accelerating its green transition: investments in renewable energy sources are hitting new records, while leading economies are announcing ambitious plans to reduce dependence on fossil resources.
Oil Market: Prices at Two-Year Lows Due to Oil Oversupply and Hopes for Peace
- Global Supply: The global oil market remains oversaturated. OPEC+ countries and other producers are collectively producing more oil than the market consumes at the current demand level. Commercial crude stockpiles in key regions are at a high level, intensifying downward pressure on prices.
- OPEC+ Decisions: The cartel and its allies are demonstrating caution. At the latest meeting, leading OPEC+ participants agreed to maintain production quotas for Q1 2026 at the level of December 2025, effectively extending current limitations. If necessary, the coalition is ready to swiftly adjust production: reserve capacity of around 1.65 million barrels per day can be gradually returned to the market as conditions demand.
- US at Peak: Oil production in the United States is close to record levels. Despite a reduction in the number of active rigs, technological efficiency has allowed new peaks to be reached in mid-2025 (production in the continental states exceeded 11 million barrels per day). High production levels in the US add significant volumes to the market, compensating for part of the OPEC+ cuts.
- Local Disruptions: Recent incidents have only temporarily affected exports. At the beginning of December, Ukrainian drones damaged one of the KTK's piers in the Black Sea, through which Kazakh oil is exported; however, shipments quickly resumed through a backup terminal. Additionally, Libya's largest oil loading terminals were temporarily closed on December 5–6 due to a storm. These events did not trigger a price spike — the market is able to absorb short-term disruptions given the current balance of supply and demand.
- Price Benchmarks: Brent remains in a narrow range of $62–64 per barrel (over 20% lower than early autumn levels). Investors expect prices to remain restrained in the near term: no sharp revival in demand is anticipated, and the easing of monetary policy in the US is only moderately supporting commodity markets. At the same time, any new geopolitical shock (escalation of conflict or significant disruptions in production) could lead to a temporary price spike.
Gas Market: Europe Enters Winter with Comfortable Supplies and Low Prices
- High Filling of Gas Storage: By early December, European gas storage facilities are filled to about ¾ (75–80%). Stocks are gradually decreasing as cold weather sets in, but still significantly exceed average levels for this time of year. The created buffer drastically reduces the risk of gas shortages in the peak of winter.
- Record LNG Imports: Supplies of liquefied natural gas to Europe remain at historically high levels. A decrease in demand for LNG in Asia has freed up additional volumes for the European market, partially compensating for the cessation of pipeline supplies from Russia. The US has taken on a particularly important role, increasing LNG exports and becoming a key external gas supplier for the EU amid rising demand.
- Diversification of Sources: European countries are strengthening energy security through alternative suppliers. Purchases of gas from Norway, Algeria, Qatar, Nigeria, and other regions have increased. New infrastructure — from LNG terminals to international interconnectors — is operating at full capacity, ensuring a steady inflow of fuel from various parts of the world.
- Low Prices: Wholesale gas prices in the EU are currently an order of magnitude lower than peak values in 2022. The Dutch TTF index remains below €30 per MWh (about $330 per thousand cubic meters) and has continued to decline smoothly for the third consecutive week. Despite a seasonal increase in consumption and episodic reductions in renewable energy generation, the market remains balanced thanks to an abundance of supply. No new price spikes are anticipated for now.
Russian Market: Fuel Shortage and Extension of Export Restrictions
- Ban on Gasoline Exports: The Russian government introduced a temporary total ban on the export of automotive gasoline by all producers and traders (except for minimal supplies under intergovernmental agreements) back in late August. Initially, the measure was intended to last until October, but the autumn fuel crisis forced an extension: the ban effectively remains in effect until the end of the year to maximize domestic gasoline supply.
- Restrictions on Diesel: Parallel to this, the ban on diesel fuel exports for independent traders has been extended until the end of 2025. Oil companies with their own refineries are allowed limited diesel exports to avoid stopping production due to tank overflow. These measures are aimed at preventing a recurrence of the fuel shortage on the domestic market, which in autumn caused a spike in wholesale prices.
- Stabilization within the Country: Thanks to the measures taken, the situation at gas stations has noticeably improved. Prices for gasoline and diesel fuel within the country have retreated from September peaks and stabilized under state control. Long-term regulatory mechanisms are under consideration — adjusting the dampening system, preferential lending for independent gas stations, and changing tax burdens — to avoid new supply disruptions in the future.
- Production and Redirection of Exports: Russian oil production at the end of 2025 is around 9.5 million barrels per day, in line with OPEC+ quotas. At the same time, oil exports have been redirected from the European to the Asian vector: buyers from India, China, and other Asian countries are purchasing Russian oil at a discount to global prices. In the gas sector, pipeline gas exports to Europe have decreased to a minimum; however, supplies to China via the "Power of Siberia" pipeline have reached unprecedented levels, partially compensating for lost markets.
Sanctions and Policy: Increased Pressure from the West Amid Dialogue Attempts
- Long-term EU Restrictions: Brussels is solidifying the legislative rejection of Russian energy resources. On December 4, EU institutions agreed on a regulation stipulating that imports of Russian pipeline gas must be completely halted by November 1, 2027. Simultaneously, EU countries intend to accelerate the reduction of remaining purchases of Russian oil and petroleum products, despite potential costs for their refiners.
- G7 Measures: The Group of Seven and allies maintain strict sanctions against the Russian energy sector. A price cap on Russian oil is in effect, as well as an embargo on many types of oil products. Financial restrictions complicate transactions and insurance for dealings with Russian oil and gas. Although some Asian importers continue to increase purchases from Russia, circumventing restrictions, the collective West is not signaling any willingness to ease the sanctions regime until the conflict is resolved.
- Diplomacy and Negotiations: In the past week, the US and Ukraine have held several rounds of consultations on a peaceful settlement, developing the framework for a potential agreement. These contacts have generated cautious optimism regarding the prerequisites for the start of a peace process. However, Russia is not participating in these negotiations, and hostilities continue without a noticeable decrease in intensity. No real grounds for lifting sanctions or easing geopolitical confrontation have emerged as of yet.
- Market Risks: The situation remains tense. Strikes against energy infrastructure continue within the context of the conflict: attacks on oil terminals, gas facilities, and power grids increase uncertainty. Any escalation affecting export routes (for example, oil transit through the Black Sea or residual gas supplies through Ukraine) could destabilize markets. Nevertheless, the global energy supply system is currently demonstrating resilience to local shocks, and market participants hope to avoid direct confrontation between NATO and Russia, which could trigger a global energy shock.
Asia: India and China Strengthen Energy Security
- India's Position: Under pressure from the West, New Delhi temporarily reduced purchases of Russian oil in late autumn; however, India remains one of Moscow's largest clients overall. Indian refineries actively process available Urals oil at discounted prices, covering domestic fuel needs. Surplus volumes of oil products are exported by Indian companies, including to European markets, effectively bringing Russian barrels to end consumers after processing.
- China's Strategy: Despite economic slowdown, Beijing retains a key role in the global energy market. Chinese importers are diversifying supply channels: new long-term contracts for LNG procurement have been signed (with Qatar, the US, etc.), and supplies of pipeline gas from Russia are increasing (volumes via the "Power of Siberia" reached record levels this autumn). Additionally, China is building up strategic oil reserves and stimulating increases in domestic production to reduce dependence on external sources.
- Growing Demand: Emerging economies in Asia continue to increase consumption of energy resources. In 2025, regional demand for oil and natural gas rose, although growth rates were somewhat tempered due to high prices from the previous year and more moderate GDP growth. India shows a steady increase in fuel consumption (gasoline, diesel) as the vehicle fleet and industries expand. China is focusing on the gasification and electrification of its economy, sustaining high demand for natural gas and electricity. The long-term goal of both countries is to meet energy consumption without undermining environmental targets; thus, renewable energy capacity is also growing rapidly.
Renewable Energy: Record Investments Supported by Governments
- Record Growth: The year 2025 has become another record year for investments in renewable energy sources. According to analysts, global investments in green energy have surpassed $1 trillion, outpacing capital expenditures in fossil fuels. Renewable energy capacity is growing at unprecedented rates: more than 300 GW of new solar and wind power plants have been commissioned worldwide over the year, exceeding last year's figures.
- Climate Policy: At the COP30 climate summit held in November in Brazil, the global community reaffirmed its commitment to accelerating the energy transition. Countries agreed to aim for tripling renewable energy capacity by 2030 and set a benchmark for annual financing of climate initiatives at $1.3 trillion. Many governments and companies announced new emission reduction targets and increased their share of clean energy, backing their words with subsidies and tax incentives.
- New Projects: Large-scale clean energy projects are being implemented everywhere. Europe has commissioned more offshore wind farms. In China and India, gigantic solar farms are under construction, and the first hydrogen hubs based on solar and wind energy are being launched in the Middle East. The boom in energy storage systems continues: many countries are introducing large battery complexes to smooth out irregularities in renewable energy generation. Despite economic challenges, investors maintain high interest in the green sector, anticipating long-term returns from low-carbon projects.
Coal Sector: High Demand Supports the Market, But Peak Has Passed
- Asian Demand: China, India, and Southeast Asian countries remain the largest consumers of coal. In 2025, global coal consumption remains close to historical highs due to these regions, where coal still dominates electricity generation. Emerging economies are in no hurry to abandon cheap coal, especially as energy consumption grows, using it to ensure the base load of their energy systems.
- Signs of a Plateau: Despite high demand volumes, market growth in coal is slowing. Analysts note that global coal consumption has likely plateaued and will begin to decline in the coming years as new renewable energy and gas power generation capacities come online. In several countries (the US and Europe), coal-fired power plants continue to be closed, while China is reducing plans to build new coal mines and plants in line with declared carbon neutrality goals.
- Prices: Global coal prices have stabilized after a turbulent rise in 2022. The base index for energy coal (ARA, Europe) is around $95–100 per ton, significantly lower than peak values from the previous year. In Asia, quotes have also reduced due to improved logistics and increased supply from major exporters (Australia, Indonesia, Russia). Significant price surges are not anticipated unless there occurs an extremely cold winter or other force majeure situations.
- Pressure from Energy Transition: The coal industry is feeling growing pressure from environmental restrictions. International banks and funds are increasingly refusing to finance coal projects; investors are demanding emission reduction strategies from companies. Even countries heavily reliant on coal are declaring plans to gradually reduce the share of coal generation by the 2030s. All this indicates that the global "coal peak" is near or has already passed, and in the long term, coal's role will gradually diminish.
Oil Products and Refineries: Diesel Demand Is Growing, Gasoline Is Stagnating
- Distillates on the Rise: Global consumption of distillate fuels — primarily diesel and aviation fuel — continues to increase. Global air travel has almost recovered to pre-crisis levels, stimulating growth in demand for jet fuel. Diesel fuel remains the backbone of transportation and industry: logistics, agriculture, and construction expansions in developing countries support high levels of diesel demand. Refineries in many regions are increasing diesel fraction yields to take advantage of favorable market conditions.
- Gasoline: Consumption of automotive gasoline in developed countries has peaked and is starting to decline. Improvements in vehicle fuel efficiency, growth in hybrid and electric vehicle sales, and environmental constraints in cities are reducing gasoline demand in Europe and North America. In emerging economies (Asia, Africa, Latin America), gasoline consumption is still rising alongside vehicle ownership. However, globally, the gasoline market is in a stage of stagnation, prompting refiners to adapt to new realities.
- Refining Adaptation: The oil refining sector is adapting to structural shifts in demand. New high-tech refineries in Asia and the Middle East focus on producing in-demand products — diesel, jet fuel, and naphtha for petrochemicals. Simultaneously, older facilities in OECD countries are being decommissioned due to low margins and tightening environmental regulations. In 2025, global oil refining volume saw a slight increase compared to last year; however, investments are concentrated primarily in regions with growing demand, while in Europe and the US, sectoral capital is shifting towards producing biofuels and petrochemicals.
Companies and Investments: Industry Consolidation and Project Diversification
- Russian Players: Russian energy companies are adapting to sanctions and relying on domestic resources for development. Gazprom Neft plans to issue ruble bonds worth up to 20 billion rubles with a floating rate linked to the Central Bank's key rate to attract financing amid closed external capital markets. Rosneft is advancing the "Vostok Oil" megaproject in the Arctic, constructing infrastructure for the development of giant fields in Tyum; the project is expected to significantly increase oil production by the end of the decade.
- Majors' Strategies: Western oil and gas giants (ExxonMobil, Chevron, Shell, BP, etc.) are maintaining expense discipline amid low prices. They focus on projects yielding the maximum return and limit capital expenditure growth, prioritizing shareholder value — paying stable dividends and conducting stock buybacks. Consolidation continues: in the US in the past two years, significant transactions have taken place (ExxonMobil acquired shale company Pioneer Natural Resources, Chevron acquired Hess), strengthening the positions of supermajors and their resource base.
- Middle East and New Directions: State-owned companies in the Gulf actively invest in both traditional oil and gas and new sectors. Saudi Aramco, ADNOC, and QatarEnergy are expanding oil and gas production, constructing refineries and petrochemical complexes while also financing hydrogen, carbon capture, and renewable energy projects. Oil exporters are thus diversifying their business models in preparation for the gradual transition of the global economy to low-carbon sources. Overall, global investments in oil and gas exploration and production in 2025 showed moderate growth compared to the lows of recent years — reflecting the cautious optimism of the industry regarding future demand for hydrocarbons.
