Current News in the Oil, Gas, and Energy Sector as of December 1, 2025: Trends in the Oil Market, Europe's Gas Balance, Renewable Energy Development, Coal Sector Dynamics, and Oil Refinery Prospects. Analytics for Investors and Energy Companies.
Current events in the global energy market are unfolding under the pressure of oversupply and geopolitical uncertainty. Oil prices remain near two-year lows due to weak demand, while European gas stocks are close to record levels, ensuring stability during the heating season. Against this backdrop, global investors are actively investing in "green" energy and network modernization, considering long-term trends towards a clean energy transition. Below is an overview of key news in the oil, gas, and energy sectors as of December 1, 2025.
Oil Market: Supply and Demand Balance
- OPEC+ production increase: OPEC+ members have agreed to a slight increase in quotas for December (approximately +137 thousand barrels per day), while maintaining a freeze on further increases in Q1 2026 due to concerns about market oversupply. This supports supply surplus and restrains significant price growth.
- Demand slowdown: The International Energy Agency reports weak dynamics in global oil consumption. Demand is growing much slower than last year, which, coupled with inventory accumulation (especially in the U.S.), exerts downward pressure on quotes.
- U.S. inventories: The level of commercial oil reserves in the U.S. continues to rise (the Energy Department's reports indicate an increase last week), while the number of active drilling rigs remains close to historical lows. At the same time, U.S. production (13.8 million barrels per day in September) is reaching record highs, raising concerns about oversupply in the market.
- Geopolitical context: Negotiations between the U.S., Russia, and Ukraine over conflict resolution remain in the spotlight for investors. Statements of willingness to negotiate previously led to a short-term drop in oil prices (in anticipation of sanctions relief), but a lack of guarantees maintains uncertainty. Even in the event of a peace agreement, any lifting of restrictions on Russian oil exports will be gradual, therefore, its impact on global prices is unlikely to be instantaneous.
Gas Market: Stocks and Regional Trends
- European reserves: As of early December, European underground storage facilities are filled to about 75-80% of total capacity, significantly exceeding averages from previous years and providing a buffer for the cold season. This state of affairs rules out panic buying and sharp price spikes for gas.
- Prices and LNG: European gas prices (TTF) are holding below €30/MWh — the lowest since the onset of the energy crisis. The U.S. and other suppliers are actively ramping up liquefied gas exports (in 2025, LNG imports to the EU doubled compared to the same period last year). Meanwhile, Russia continues to redirect gas to the east: supplies to China are increasing via "Power of Siberia," and Gazprom is boosting deliveries to Turkey, compensating for the complete halt of transit through Ukraine.
- Changing routes: Europe is continuing to diversify its supplies — new LNG terminals and inter-regional gas pipelines (through North Africa, Azerbaijan, etc.) are being built. Russia is seeking new routes and sales mechanisms: land routes to China are being considered, the ramp-up of LNG flows from "Yamal LNG" and "Arctic LNG" is accelerating, and new pipeline projects for southern routes are being discussed.
Electric Power and Renewable Energy: Investments and Innovations
- Record growth in "green" generation: Historic records for electricity generation from wind and solar have been set in many countries. Major wind and solar projects have been completed in Europe, the U.S., and China. Investors are pouring record amounts into expanding clean energy and developing energy storage systems (lithium-ion and alternative batteries) to enhance network flexibility with a high share of renewable sources.
- Climate agenda: At the COP30 climate summit in Brazil, world leaders agreed on annual investments of about $148 billion for modernizing power grids and energy storage systems, as well as launching a global carbon trading system. However, the final declaration did not include direct calls for abandoning hydrocarbons, reflecting an attempt to take into account the interests of fuel exporters and proponents of the green transition.
- Nuclear energy: Russia has announced a large-scale nuclear power plant development program — by 2042, 38 new power units (about 30 GW) are expected to be commissioned, increasing the share of nuclear generation to a quarter of the energy balance. Simultaneously, China, the U.S., and several European countries are investing in new small modular reactors and exploring innovative nuclear technologies to support the role of nuclear energy in maintaining grid stability.
Coal Sector: Demand and Prices
- Growth in Asia: China entered the 2025/2026 heating season with record coal production — in October-November, electricity generation from coal-fired plants exceeded last year's figures by 7-8%. However, coal mining restrictions in China (according to "anti-inflation" measures) are leading to raw material shortages and rising domestic prices: coal quotations at port terminals have risen nearly 40% from this year's lows.
- Europe and the world: In contrast to Asia, Europe and the U.S. continue to reduce coal consumption (in favor of gas and renewables). Some countries are systematically closing coal-fired power plants, lowering demand. According to World Bank estimates, global coal demand fell by about 1% year-on-year in the first half of 2025 due to rapid growth in green generation, although a resurgence in industrial growth could alter this dynamic.
- Prices and trade: Limited production by major exporters (Indonesia, Australia) and rising demand in Asia are supporting global coal prices. European traders are reducing purchases, but volatile funds remain in the market: major players are already signing long-term contracts for coal supplies in 2026, anticipating that prices will continue to rise.
Oil Products and Refineries: Domestic Market and Exports
- Tax incentives abroad: At the end of November 2025, Russia adopted a law allowing oil companies to reclaim paid excise duties for processing oil at foreign refineries under a "customs" scheme. This dampening mechanism applies to gasoline and diesel produced from Russian oil at foreign refineries (including Belarusian ones), stimulating processing abroad and increasing exports of oil products to Asia and Europe.
- Stabilizing the domestic market: After an autumn fuel deficit, the government imposed export restrictions on gasoline and diesel and expanded dampening mechanisms. By the end of November, domestic wholesale prices for automotive fuel began to decline, eliminating shortages at gas stations. This stabilizes retail prices and reduces inflationary pressure on the economy.
Russian Oil and Gas Sector: Finances and Infrastructure
- Financial results: The total net profit of the largest Russian oil and gas companies fell by almost half in the first nine months of 2025 (to about 2 trillion rubles), while the number of loss-making enterprises sharply increased. This decline is linked to the drop in the average export price of Urals (to ~$65–70 from $75–80 a year earlier), the strengthening of the ruble, and rising costs (insurance, logistics) in a sanctions environment.
- Gas segment: Gazprom remains profitable due to high contract prices and market diversification. Despite the complete halt of transit through Ukraine, the company has increased supplies via the "Power of Siberia" and "Turkish Stream." The government supports the sector with programs for modernizing gas transportation infrastructure and constructing new underground gas storage facilities.
- Oil segment: Oil production in Russia is nearing its maximum, but revenue is declining due to sanctions and market oversaturation. Launching new projects is hampered by restrictions (sanctions against Rosneft and Lukoil), so Gazprom Neft and Rosneft are reallocating capacities in favor of petrochemicals and exports to eastern markets, while domestic refineries operate at reduced capacity.
Geopolitics and Sanctions: Impact on the Energy Market
- Diplomatic negotiations: The energy market is sharply reacting to reports about the progress of negotiations regarding Ukraine. While there are no real shifts toward peace, local price reactions are limited by expectations of future changes. Investors understand that any agreement will lead only to a gradual easing of export restrictions, so fundamental factors of supply and demand continue to drive price fluctuations.
- International diversification: Western countries are systematically reducing their dependence on Russian energy resources. Europe is increasing purchases from the U.S., the Middle East, and other regions, while also expanding programs for green energy. The U.S. and its allies are increasing their own oil and gas production to strengthen energy security while maintaining sanctions against Russian oil and gas projects.
