Oil Market: Brent at $87 — Market Awaiting Deal on Hormuz
Oil prices are finishing the week with mixed signals. Brent is trading around $87 per barrel after a 2.2% decline on Thursday, while WTI hovers around $81. Since the onset of the conflict between the US and Israel with Iran in late February, the international benchmark has risen by approximately a quarter, and the year-on-year increase exceeds 30%. The key factors driving price dynamics include:
- Hormuz Strait Status: The key maritime corridor, through which about one-fifth of global oil supplies flowed before the war, remains formally blocked. Iran and Oman are negotiating shipping routes, but no agreement has been reached: Tehran demands the lifting of the US maritime blockade as a prerequisite for the complete opening of the strait.
- Actual Flows: Despite the deadlock in negotiations, oil continues to leave the Persian Gulf — according to US estimates, up to 9 million barrels per day transit through the strait, with some tankers operating with their transponders turned off, and the capabilities of the US Navy to escort vessels are expanding. Attacks on tankers and energy infrastructure maintain a risk premium.
- Supply Shortage: The International Energy Agency (IEA) estimates the oil deficit on the global market for the current quarter at 1.8 million barrels per day — double the previous forecast; in July, supply remained 6.3 million barrels per day below last year's level.
The US Energy Information Administration (EIA) does not expect the return of Middle Eastern production to pre-war levels before early 2027 and forecasts an average Brent price of $87 per barrel in 2026.
Demand Under Pressure: IEA and OPEC Cut Forecasts
The flip side of the price shock is the destruction of demand. This week, the IEA lowered its forecast for global oil consumption, warning that the protracted conflict and high prices are increasingly pressuring economic activity. OPEC, in turn, has cut its forecast for global demand growth in 2026 to 580,000 barrels per day — marking the fourth consecutive downgrade. An additional bearish signal has come from the US: commercial oil inventories rose by 17.4 million barrels last week — a record weekly increase — amid significant withdrawals from strategic reserves and a sharp rise in imports. Several analysts believe that the peak of the market deficit occurred in May-June; however, the further price trajectory entirely depends on the course of the conflict and the status of the Hormuz Strait.
Gas Market: Europe Enters Winter with Record Low Stocks
The European gas market remains the most vulnerable link in global energy. Prices at the TTF hub varied between €56 and €62 per MWh throughout the week, surging by over 10% early in the week due to supply risk news. Key issues include:
- Low Stocks: EU underground storage facilities are filled to only about 55-58% — the worst level for mid-August since records began in 2009 and approximately 22 percentage points below the five-year average. Brussels has already lowered the mandatory filling target from 90% to 80% by November 1, but this is also at risk.
- LNG Shortage: Shipments of Qatari liquefied gas through the Hormuz Strait are significantly delayed, and competition with Asia for available cargoes has intensified amidst a hot summer.
- The Norwegian Factor: The extension of repairs at the Ormen Lange field until February 2027 could remove over 1 billion cubic meters of gas from the market during the heating season.
Banks and energy companies are raising price targets: Commerzbank has increased its year-end forecast to €50 per MWh, while Uniper anticipates a range of €50-60 as long as the strait remains closed. The heat in Europe further drives up demand for electricity for air conditioning, intensifying pressure on the gas balance.
Power Generation and Renewables: Sun and Wind Setting New Records
Amid the hydrocarbon storm, renewable energy shows a structural breakthrough. According to the Ember analytical center, by 2026, the combined output from solar and wind stations in Europe could exceed gas generation for the longest period in history — the monthly output from renewables reached 80-110 TWh. The global picture is equally impressive: in 2025, the world introduced a record 800 GW of renewable capacity (+16% year-on-year), of which over 600 GW came from solar energy; China accounted for about 60% of the global increase. For the first time, solar energy has become the largest source covering the increase in global energy consumption. In the US, wind and solar provided a record 17% of electricity generation, and by 2026, almost all net capacity growth will come from renewables and storage systems. High prices for gas and oil are only accelerating investment in clean generation, storage systems, and grids.
Coal: Beneficiary of the Energy Crisis
The coal market is strengthening on the effect of inter-fuel switching. Futures for Newcastle thermal coal have stabilized around $130 per ton — about 17% above last year’s level: high oil and gas prices enhance the appeal of coal generation in importing countries in Europe and Asia. China has released a five-year plan for the coal industry, aiming to consolidate and digitalize mines while creating a reserve capacity of over 100 million tons per year. India is ramping up its own production — in July, output increased by 7.5% year-on-year, reducing dependence on imports. In the short term, coal remains a safeguard for Asian energy systems against gas shortages and expensive oil.
Russia: Fuel Export Ban Extended to the End of January 2027
The internal market for petroleum products in Russia continues to be under manual control. The government has extended the complete ban on the export of motor gasoline — now until January 31, 2027, expanding restrictions to both producers and traders; the export regime for diesel fuel, marine fuel, and gas oils has been tightened. Reasons and accompanying measures include:
- drones' intensified attacks on refineries in early August led to the shutdown of several plants and a decrease in gasoline exchange sales;
- exchange prices have stabilized at high levels: the AI-92 index hovers around 71,400 rubles per ton, and AI-95 is around 76,000 rubles per ton;
- authorities have permitted the production of Euro-3 class fuel and simplified the import of petroleum products from friendly countries;
- a mechanism for direct contracts between plants and suppliers bypassing the exchange is being developed to reduce speculative pressure.
Experts expect a gradual normalization of supply by the end of August and do not rule out a significant decline in wholesale prices no earlier than the fourth quarter — provided there are no new emergency shutdowns of refineries.
What This Means for Investors and Market Participants in the Energy Sector
The market has entered a phase of fragile equilibrium: the geopolitical premium in oil faces increasing signs of demand destruction, while the European gas market prices in the risk of a deficient winter. For investors, key benchmarks for the coming weeks include:
- Negotiations on the Hormuz Strait — any progress could crash oil and gas prices by 10-15%, while a breakdown in dialogue would push Brent back to $90 and higher.
- Gas Injection Rates into European UGS — falling behind schedule by the end of September will trigger early price formation for winter deficit on TTF.
- Data on Stocks and Demand in the US and China — confirmation of consumer weakness will reinforce the correction scenario in oil.
- The Situation with Russian Refineries — the balance of the domestic fuel market and the timeline for easing export restrictions depend on the recovery of refining capacity.
Daily Summary: Key Energy Sector Figures as of August 15, 2026
- Brent — around $87 per barrel; WTI — around $81;
- global oil market deficit — 1.8 million b/d for the current quarter (IEA estimate);
- forecast for oil demand growth in 2026 — 580,000 b/d (OPEC, fourth consecutive downgrade);
- TTF gas — €56-62 per MWh; EU UGS fill level — about 55-58%;
- Newcastle coal — around $130 per ton (+17% year-on-year);
- ban on gasoline exports from the Russian Federation — extended to January 31, 2027.
Saturday in the energy markets will be marked by anticipation: the fate of the Hormuz Strait remains the key pricing factor for oil, gas, coal, and electricity worldwide. Investors and energy companies should prepare for increased volatility — the autumn of 2026 promises to be a test of strength for the entire global energy system.
