Oil & Gas and Energy News, Tuesday, December 2, 2025 — Negotiations on Ukraine, Markets, and COP30 Outcomes

Current News in the Oil, Gas, and Energy Sector as of December 2, 2025: Market Situation, Renewable Energy Updates, Geopolitics, Investments, and Key Events in the Global Energy Sector.

Oil Market

• OPEC+ maintained its production levels during the November meeting for Q4 2025 and Q1 2026, keeping the existing cut scheme (approximately 3.2 million barrels per day) amid forecasts of slowing demand.
• The U.S. is producing a record volume of oil (~13.8 million b/d), while commercial oil inventories are increasing. The growth of domestic inventories in the U.S. and other countries is limiting further increases in global fuel prices.
• Incident in Novorossiysk: Ukrainian drones damaged one of the Caspian Pipeline Consortium (CPC) docks, reducing oil shipments to the port. This incident temporarily lowered CPC exports (around 1% of global supply), causing brief price fluctuations.
• Geopolitics: negotiations regarding Ukraine remain a key factor. The prospect of a peaceful settlement could eventually ease sanctions against Russia and increase oil and gas supplies. At the same time, the risk of new restrictions and asset regrouping sustains uncertainty in the sector.

Gas Market

• European reserves: at the start of the 2025/26 heating season, EU gas storage facilities are filled to approximately 75-80% of capacity, significantly above average levels. This reduces the risk of gas shortages and keeps prices low (TTF ~30 €/MWh).
• LNG imports: Europe is actively increasing imports of liquefied natural gas. The launch of new terminals in the U.S. and Australia, along with reduced demand from Asia, has provided additional LNG volumes for the EU. In 2025, LNG flows to Europe have significantly increased, helping to diversify supplies.
• Russian supplies: Russia is shifting its focus to Asian markets. Exports via the "Power of Siberia" to China are increasing, with the "Power of Siberia-2" project expected in 2026. Gazprom is negotiating contract extensions with Turkey, maintaining exports via the "Turkish Stream." Traditional lines to Europe are currently operating at reduced capacity.
• Domestic demand: in Germany, gas consumption has significantly increased due to reduced wind and hydroelectric production. This is slowing the filling of storage facilities and creating local price pressure in the region, although the European system as a whole is receiving the necessary imports.

Electric Power and Renewable Energy

• Record growth in renewables: renewable energy sources are adding capacity at unprecedented rates. Solar and wind generation in many countries have outpaced electricity demand growth for the first time, stabilizing global CO₂ emission levels. China and the U.S. remain leaders in scaling up "clean" energy, while Europe is gradually adjusting its support programs.
• Infrastructure investments: following COP30, global energy companies and governments announced plans for large-scale funding for network modernization and storage systems. Only the energy giants promised to invest around $148 billion annually in new transmission lines and energy storage systems, facilitating better integration of variable energy sources.
• EU policy: Brussels continues its course towards energy independence. New measures have been adopted under REPowerEU—phased import bans on Russian gas and oil are planned by 2027, refill requirements for gas storage are extended to the end of 2027, and financing for energy efficiency and clean energy projects is being strengthened. The accelerated construction of new renewable energy projects and networks is also under discussion.
• Nuclear program: despite the emphasis on "green" energy, countries are not abandoning nuclear energy. A recently published EU report indicates that investments in nuclear power plants (extending operational periods and constructing new ones) will require about €241 billion by 2050. Concurrently, plans for small modular reactors (SMR) and hydrogen technologies are developing as "bridges" to a decarbonized economy.

Coal Sector

• Long-term contracts in Asia: many countries in the Asia-Pacific region are still forced to maintain high coal consumption. Agreements made years ago ensure the operation of coal-fired power plants for decades, regardless of wind or sunlight availability. Experts estimate that, in Southeast Asia, coal still accounts for a significant share of generation, although the global share of coal is gradually declining.
• Global trends: despite this, some major economies have announced a phased exit from coal. The Chinese market is showing early signs of decreasing emissions due to a record increase in renewables: in 2025, its coal emissions fell for the first time. South Korea, India, and several European countries have announced new targets for reducing coal generation while increasing the role of "clean" energy.
• Climate commitments: the final document of COP30 was devoid of any direct mention of "coal" (under pressure from exporting countries), but individual countries announced their own measures. For instance, South Korea will halt the construction of new coal-fired power plants and gradually close existing ones. Moreover, an international methane reduction fund was launched at the summit (£25 million contribution), indirectly signaling a transition to cleaner energy sources.

Oil Products and Refineries

• Changing demand: the demand for oil products is changing unevenly. Diesel and aviation kerosene are recovering faster due to rising cargo volumes and the resumption of air travel, whereas gasoline demand is recovering more slowly. This shift in demand is prompting refineries to adjust their product outputs (increasing the share of diesel and jet fuel).
• Processing: refineries in Asia and the Middle East are operating nearly at full capacity due to high raw material supply. This boosts confidence in oil product exports but constrains margins due to the excess of raw materials. In Europe, some refineries have shifted to processing oil grades not sanctioned, but overall plant utilization remains high.
• Sanctions: restrictions on Russian oil products continue to influence the balance. The EU and the U.S. have imposed a ban on the import of diesel and kerosene from Russia, forcing some refineries to seek alternative supplies. These measures keep prices stable amid an excess of raw materials but simultaneously compel companies to accelerate the development of alternative fuels and comprehensive recycling of by-products.

Companies and Investments

• Exploration and projects: Europe is gradually relaxing restrictions on drilling. In Greece, a license for an offshore gas field was issued for the first time in 40 years to Exxon/Energean, while in Italy and the UK, companies such as Shell and Chevron have received or are awaiting approvals to expand existing fields. These steps reflect a new approach to domestic resource exploration.
• M&A activity: the segment is highly active. For instance, Targa Resources acquired gas transportation assets in the Permian Basin for $1.25 billion, strengthening its pipeline network in the U.S. Oil traders (like Gunvor and Vitol) are considering participation in U.S. shale projects, seeking to diversify their portfolios and secure long-term fuel supplies.
• LNG projects: investors are reassessing long-term commitments. The UK government has refused to finance $1.15 billion for an LNG project in Mozambique due to security risks and shifting global priorities. TotalEnergies is preparing to resume work on this project, but timelines and funding volumes are subject to reassessment.

Geopolitics and Regulation

• Sanctions and agreements: negotiations regarding Ukraine continue to influence the market. While there is no specific agreement yet, discussions include plans for further tightening sanctions against Russia after 2025. The European Union has already extended the mandatory gas storage filling norms until the end of 2027 and announced new incentives for "green" projects to ensure energy independence.
• International cooperation: G20 countries and COP30 participants agreed to increase funding for climate programs. The estimated funding needs for developing countries to achieve climate goals by 2030 reach $2.4 trillion annually. China and India have confirmed their readiness to play a key role in expanding renewable energy, while developed nations have pledged additional investments in clean technologies.
• Regional initiatives: new organizations are forming at the union level. The EU has created an Energy and Raw Materials Platform for the joint procurement of critical resources (hydrogen, natural gas, etc.). In Asia, cooperation is growing to establish regional gas markets and develop "green" funds. Many countries are developing national decarbonization roadmaps, introducing tax and subsidy incentives for the transition to clean energy.
• Technological standards: concurrently, emissions regulations are being improved. The U.S. is tightening methane emission standards for oil and gas operations, while the EU is promoting clean energy support mechanisms through carbon pricing and quotas. These measures are intended to accelerate the transition to a "green" course and are influencing investment strategies for companies worldwide.