Energy and Oil & Gas News for July 23, 2026: Brent above $94 amidst the blockade of the Strait of Hormuz, gas TTF exceeding €60/MWh, OPEC+ quotas for August, stabilization of the Russian fuel market, LNG, refineries, electricity, RES, and coal. Overview for Investors and Participants in the Energy Sector
The global oil and gas market enters the end of July 2026 in a state not seen by traders since spring: the geopolitical risk premium has fully returned to the quotes. The escalation of the conflict between the US and Iran, the effective halt of shipping through the Strait of Hormuz, and the maritime embargo imposed by the Houthis against Saudi Arabia have pushed Brent crude above $94 per barrel—the highest level in six weeks. European gas at the TTF hub has exceeded €60/MWh for the first time since March, while injection into underground storage lags behind last year's schedule. Against this backdrop, OPEC+ maintains a cautious strategy of gradually increasing quotas, the Russian fuel market is slowly recovering from an acute gasoline shortage, and the global energy transition is facing a new reality: expensive LNG is bringing coal back into the energy balance of Asia. Below is a detailed overview of key events in the oil, gas, electricity, coal, and raw material markets for investors and participants in the energy sector.
Oil Market: The Geopolitical Premium Returns to Quotes
Oil prices are demonstrating the most aggressive upward movement since the beginning of summer. During trading on July 22, the price of the September futures for Brent crude oil on the London ICE exchange rose by more than 3%, reaching $94.14 per barrel—first time since June 11. American WTI simultaneously increased by over 3%, moving towards $87 per barrel. For comparison, on July 2, Brent was trading below $71, while in mid-June it was around $80.5. Thus, over three weeks, the market has recovered more than 30% of its value.
Key drivers of the current oil rally include:
- Blockade of the Strait of Hormuz. According to shipping traffic data, on several days last week, no vessel crossed the strait, through which about one-fifth of global maritime oil trade and a significant portion of LNG flows.
- Direct attacks on tanker fleets. Incidents have been recorded involving fires and immobilization of oil tankers during attempts to pass through the southern route, as well as cases where crew members were forced to abandon their vessels.
- Maritime embargo by the Houthis. Yemeni factions have announced a blockade of supplies from Saudi Arabia, jeopardizing the export flows of the largest OPEC producer.
- Expansion of the front. The US is increasing its military presence in the region by deploying additional aircraft at bases in Israel; the market is factoring in the risk of full-scale US involvement in the conflict.
- Decline in stocks. The IEA reports a reduction in global commercial oil stocks, which increases price sensitivity to any supply disruptions.
What This Means for Investors
The widening Brent-WTI spread to $7-9 per barrel is a classic indicator that the market is pricing the risk of disruptions specifically in Middle Eastern logistics, rather than a global supply deficit as such. For oil companies with diversified resources outside the Persian Gulf, this means a temporary expansion of margins. For oil traders and fuel companies, there is a sharp rise in freight and insurance rates, which are already eroding some of the price gains.
OPEC+: Cautious Quota Increase Instead of Price War
The OPEC+ alliance maintains a conservative approach. Following a video conference on July 5, seven countries voluntarily cutting output beyond the overall quotas—Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman—agreed to increase quotas for August by 188,000 barrels per day. The total quota for the alliance in August will be 36.019 million b/d. Saudi Arabia and Russia each receive an increase of 62,000 b/d.
Key parameters of the deal at this time include:
- From February to August 2026, the total quota has increased by approximately 940,000 b/d—a volume comparable to the production of a mid-sized participating country.
- The 'Seven' are returning to the market restrictions of 1.65 million b/d considering the share of the UAE, which left the alliance in May due to dissatisfaction with quota distribution.
- To fully roll back voluntary restrictions, September quotas must be raised by another 188,000 b/d. The next meeting is scheduled for August 2.
- Iraq has publicly considered leaving the agreement if there is no increase in its production limit—this is a factor indicating the internal fragility of the alliance.
The OPEC+ dilemma for the second half of the year is clear: analysts predict a return to structural oversupply after normalizing the situation in the Persian Gulf. The alliance will have to choose between restraining production for the price and fighting for market share. Meanwhile, the current geopolitical premium obscures this choice.
Gas Market: Europe Pays a Premium and Lags Behind Injection Schedule
The European gas market is under double pressure. Quotes at the Dutch TTF hub exceeded €60/MWh on July 20 for the first time since mid-March, adjusting to €59 on Tuesday. In dollar terms, the price approached $700 per thousand cubic meters. Since the beginning of July, the European gas benchmark has risen by approximately 35%, while the Asian JKM Platts index has increased by about 25%.
The main problem for the European Union is not so much the price, but rather the pace of filling underground gas storage:
- The heating season 2025–2026 concluded with extremely low stocks: as of April 1, the gas storage facilities were filled to 27.66%—13.4 percentage points below the average level over the past five years.
- As of July 19, the level reached only 53.7%, which is 15.7 percentage points below the five-year average. The gap is neither narrowing nor closing.
- Daily injection in July has dropped to 270 million cubic meters from 308 million in June. A year ago, in mid-summer, the average daily replenishment was 338 million cubic meters—25% more.
- Competition for LNG cargoes shifts in favor of Asia, where liquefied gas is needed for current consumption rather than for replenishing reserves.
Risk Scenario for Autumn
Industry experts do not expect a repeat of the peaks seen in 2022-2023, but they acknowledge that if the conflict in the Persian Gulf continues, prices could exceed $1000 per thousand cubic meters. An additional risk factor is the expected peak of El Niño in December, which could change the heating season profile. For European industry, energy, and fertilizer producers, this means the necessity of hedging now.
LNG: Record Wave of New Capacities on the Horizon 2026–2028
Despite the current tensions, the medium-term outlook for the liquefied natural gas market appears fundamentally different. According to the IEA, from 2026 to 2028, the global LNG market is expected to see the largest capacity increase in history. Projects in the US, Qatar, Canada, and several other jurisdictions are preparing for launch. Investments in LNG infrastructure are on a stable upward trajectory—unlike investments in oil extraction, where a first annual decline of about 6% has been recorded since 2020, primarily due to cutbacks in the American shale industry.
A practical takeaway for market participants: the current price surge is primarily logistic and geopolitical in nature. Structurally, the gas market is heading towards oversupply in the second half of the decade, creating an asymmetry between spot prices and long-term contractual expectations.
Gas Demand: IEA Predicts Decline in 2026
The International Energy Agency has revised its forecast for global natural gas demand downward. The regional picture is mixed:
- Asia: demand is expected to decline by about 0.5%. Expensive LNG is encouraging a return to coal generation and weakening activity in energy-intensive industries.
- The Middle East: the sharpest decline—around 4%—is due to the direct impact of the conflict on infrastructure and production.
- Eurasia: growth of about 3%.
- Central and South America: increase of about 3% against the backdrop of reduced hydroelectric output.
The price elasticity of gas demand has proven to be higher than anticipated: at high prices, consumers in developing economies quickly revert to coal. This is a key factor limiting the ceiling for gas prices even amid geopolitical stress.
Russian Fuel Market: Exiting the Acute Phase of the Fuel Crisis
The domestic market for petroleum products in Russia is going through one of its most difficult periods in recent years. The reason is a reduction in primary processing: in June-July, the operations of several large enterprises, including the Omsk and Saratov refineries, as well as the NORSI complex, were halted or limited due to infrastructure damage and unscheduled shutdowns.
Consequences for the fuel market include:
- Wholesale exchange quotes for diesel exceeded historical maximums, while trading volumes for AI-95 fell to 43% on certain days.
- Several regions implemented restrictive mechanisms for fuel sales, including a "odd-even" scheme; in resort regions of Krasnodar Krai, Crimea, and the Caucasus, seasonal demand intensified the imbalance.
- Retail prices at major gas station networks were kept within inflation levels, while independent stations saw prices rise significantly higher.
Regulatory Measures and Initial Signs of Stabilization
- Export Ban: The export of gasoline and diesel fuel is prohibited until July 31, with discussions on extending it ongoing.
- Exchange Sales Regulation: The mandatory share of sales through the exchange has been reduced from 15% to 10% to increase flexibility for direct supplies.
- Import Substitution: Belarus redirected gasoline volumes to the Russian market—historical imports reached 141,000 tons for June 1-25. Kazakhstan, which processes 15–17 million tons of oil annually, is also being considered as a potential supplier.
- Resumption of Exchange Sales: Some refineries have returned to selling fuel on the exchange, wholesale trading volumes are increasing, unsatisfied demand is decreasing, and the situation at some gas stations is stabilizing.
The priority of ensuring the domestic market remains a focus at the level of the relevant Deputy Prime Minister. Official estimates suggest normalization by August as repairs at refineries are completed. Industry experts are more cautious and allow for a shift in timelines, noting that the limitation on supply is temporary: price reductions may be possible two to three months after addressing processing issues.
Electricity and RES: Record Investments Amid Growing Flexibility Requirements
The global electricity sector is undergoing structural transformation. Total global energy investments exceeded $3.3 trillion, with investments in clean technologies—renewable energy sources, grids, storage, and nuclear generation—twice that of fossil fuels, which accounted for about $1.1 trillion. Solar photovoltaic energy is attracting more capital than any other technological direction in the energy sector. Investments in energy transition reached $2.3 trillion in 2025.
Key trends in the electricity sector include:
- RES and nuclear surpass coal in the global energy generation balance—an inflection point noted in IEA forecasts.
- Data centers as a new demand driver: In North America, electricity consumption has grown by about 2%, primarily driven by computing infrastructure and AI workloads.
- Asia sets the pace: India shows an electricity demand growth of about 6.6%—the largest contribution to global dynamics.
- Nuclear renaissance: Over a hundred reactors in France and the US are providing record volumes of nuclear generation, while Japan is systematically bringing back online previously halted units.
- Flexibility shortages: The increasing share of variable generation demands proactive investments in energy storage systems and grid modernization—without which supply reliability decreases.
Coal: The Last Resort Fuel Returns to Play
Despite the long-term trend of decarbonization, the coal market has received short-term support from the gas crisis. The mechanism is direct: expensive LNG in Asia makes coal generation economically preferable, as evidenced by falling regional gas demand. Developing economies in the Asia-Pacific region continue to rely on coal as a tool for ensuring base load and energy security.
For investors, this creates a characteristic asymmetry: coal assets demonstrate strong cash flows during periods of energy stress but remain under structural pressure from climate regulation and capital costs. Major exporters—Indonesia, Australia, Russia, and South Africa—retain the ability to quickly ramp up supplies, limiting the potential for a price rally in the coal market.
Raw Material Sector and Logistics: Insurance Premiums as a Hidden Tax
Market participants should pay particular attention to the transformation of transport-logistics costs. The military threat in the Strait of Hormuz is transmitted to the market via several channels:
- Freight Rates for VLCC tankers are rising as the number of shipowners willing to operate in a risk zone decreases.
- Insurance Premiums for war risks are being raised, effectively creating an additional tax on every barrel of Middle Eastern oil.
- Route Extensions and reorientation of flows increase the turnaround time of the fleet, reducing the effective supply of tonnage.
- Re-evaluation of delivery premiums in favor of producers outside the Persian Gulf—West Africa, Latin America, and the North Sea.
Governments in several countries are already preparing for potential disruptions in energy resource supplies by revising strategic reserve parameters. Meanwhile, regional intermediaries are attempting to negotiate a ten-day ceasefire between Washington and Tehran that could provide a foundation for new negotiations. Tehran is considering the proposal, but no final agreement has been reached yet.
Forecast and Conclusions for Energy Sector Market Participants
The current configuration of the global energy market is characterized by the overlap of a short-term geopolitical shock with a medium-term trend towards oversupply. Practical points of reference include:
- Oil: The Brent price range of $85–95 per barrel will persist until clarity emerges regarding the shipping regime in the Strait of Hormuz. Achieving a ceasefire agreement could swiftly eliminate a $10–15 premium.
- Gas: TTF quotes are expected to range between €55–65/MWh with a risk of exceeding this range under an unfavorable autumn scenario. The key indicator for monitoring is the daily injection pace in European gas storage facilities.
- Petroleum Products in Russia: Gradual balance restoration is expected as refinery repairs complete; the question of extending the export ban after July 31 remains a key regulatory risk.
- Electricity: Investment focus is shifting from generation to networks, storage, and flexibility sources—this is where the shortfall is forming.
- Coal: Tactical support from expensive gas amidst long-term structural pressure remains.
For investors, fuel, and oil companies, the key skill in current conditions is not predicting price direction, but rather managing volatility: revising hedging strategies, conducting stress tests of logistics chains, and reassessing counterparty risks in areas of heightened military danger. The energy market has entered a phase where response speed is more critical than forecast accuracy.
