Oil and Gas and Energy Sector News for Sunday, January 25, 2026. Global Overview of the Energy Market: Oil, Gas, Electricity, Renewable Energy, Coal, Oil Products, Geopolitics, Supply and Demand, Key Trends for Investors and Market Participants.
By the end of January 2026, the situation in global oil and gas markets is ambiguous. Oil prices have recently received support due to renewed geopolitical tensions and high winter demand: Brent price holds around the mid-$60 per barrel after several weeks of increase. At the same time, there are concerns about a possible oversupply throughout the year, as production remains high and world stocks may start to grow. The European gas sector is under pressure due to an unusually cold winter: gas storage facilities are being depleted at a record pace, leading to a rise in prices from low levels – although they remain significantly below the crisis peaks of 2022. Western sanctions against Russia's energy sector have tightened further at the beginning of the year, forcing Moscow to redirect oil exports to China, while previous major buyers – India and Turkey – are cutting back on purchases.
Meanwhile, the global energy transition continues at a brisk pace. By the end of 2025, renewable energy sources (RES) provided nearly half of electricity generation in the European Union – a significant milestone in the energy transition, although the stability of energy systems still largely depends on traditional resources, especially during peak demand periods. Global coal consumption, driven by Asia, reached a record level in 2025, underscoring the ongoing dependence on fossil resources, even amid the accelerated growth of the RES sector. In Russia, domestic fuel prices rose significantly in early 2026 due to tax changes and limited supply, prompting authorities to take measures to stabilize the domestic petroleum products market and curb inflation. Below is a detailed overview of key news and trends in the oil, gas, electricity, and raw materials sectors as of this date.
Oil Market: Geopolitics Heat Up Prices Amid Oversupply Concerns
Global oil prices have recently stabilized at relatively elevated levels under the influence of several factors. The North Sea Brent is trading around $65–66 per barrel, while American WTI is about $61, recovering from five-month lows reached at the end of 2025. However, current prices remain significantly below last year's peaks, and the market is cautious due to signals that supply may outstrip demand in the coming months.
- Geopolitical Tension. Risks of conflict in the Middle East have escalated: U.S. President Donald Trump has renewed threats to use military force against Iran, accompanied by a noticeable increase in naval presence in the region. These events raise the geopolitical premium in oil prices, considering Iran's key role as one of the leading OPEC producers.
- Seasonal Demand and Weather. Cold weather in Europe and a severe winter storm in North America are increasing fuel consumption for heating. Demand for oil products (primarily diesel fuel used for heating) is rising, supporting oil prices despite the overall slowdown in the global economy.
- The Dollar and Financial Markets. The weakening of the U.S. dollar to its lowest levels in several months has cheapened commodities for holders of other currencies, stimulating additional demand from investors. At the same time, hedge funds have increased their net long positions in oil to a five-month high, indicating a return of speculative optimism to the market.
- OPEC+ Actions. The oil alliance is demonstrating a cautious approach to increasing production. According to the decision of the OPEC+ meeting in November, participants suspended the increase in quotas for January-March 2026, aiming to prevent oversupply amid the traditionally weak demand in the first quarter. The maintenance of restrictions by OPEC+ supports the market and keeps prices from falling.
Together, the current influence of these factors ensures relative stability in oil prices and partially compensates for recent market declines. However, analysts warn of the potential emergence of oversupply later in 2026: according to the International Energy Agency's forecast, global oil stocks could increase by several million barrels per day if demand does not accelerate. This factor limits the potential for further price growth — the market is pricing in cautious expectations for the coming months.
Gas Market: Europe Depletes Stocks at Record Pace Amid Winter Cold
The focus of the gas market is on Europe, facing a sharp rise in gas consumption due to strong cold weather. In January, European countries have been forced to withdraw gas from underground gas storage (UGS) at the highest rates in the last five years. According to industry monitoring, the average daily withdrawal volume in the first half of the month reached about 730 million cubic meters, leading to a rapid reduction in stocks. By January 20, the total storage fill in the EU dropped below 50% (compared to ~62% a year earlier), significantly lagging behind the normal seasonal level (around 67% for this date).
The swift depletion of stocks has driven gas prices in the region higher. As of late December, gas futures prices at the TTF hub were holding in a tight range of €28–29 per MWh; however, by mid-January, prices soared to €36–37 amid forecasts for further cold spells and concerns over stock levels. Subsequently, the market adjusted to €34–35/MWh, but volatility has noticeably increased compared to the calm of last summer. Market participants are closely monitoring weather forecasts: the anticipated cold wave at the end of the month may require additional imports of LNG and further price increases to compete for supplies with Asian buyers.
Despite the extreme seasonal demand, Europe is currently avoiding acute shortages thanks to diversified supply sources. Norwegian pipeline gas is arriving in stable volumes, and LNG imports remain high — in 2025 EU countries received about 81 billion cubic meters of LNG, more than half of which (57%) was supplied by the U.S. At the same time, Europe’s dependence on American LNG continues to grow, raising concerns among some experts as excessive concentration on a single supplier contradicts the goals of the REPowerEU program aimed at strengthening energy security through the diversification of sources. The EU's complete cessation of Russian gas imports from 2026 amplifies this trend: with the exit of Russian pipeline gas, the European market becomes increasingly dependent on global LNG supplies and weather factors. Experts also warn that significant depletion of stocks during winter will complicate the task of filling UGS for the next heating season and may force Europe to purchase gas in the summer at higher prices.
International Politics: Sanction Pressure Intensifies, Energy Flows Restructure
At the end of 2025, the West imposed new stringent restrictions on the Russian oil and gas sector, further complicating energy resource trading from Russia. The U.S. and EU expanded sanctions lists in December, directly targeting the largest Russian oil companies (including Rosneft and Lukoil) and maritime transportation for the first time. Additionally, the European Union closed remaining loopholes in the fuel embargo, banning the import of oil products derived from Russian oil in third countries — a measure that severely impacted resale schemes through India and Turkey. Finally, as of January 1, 2026, a legally established full ban on purchasing Russian natural gas came into force in the EU, marking the effective conclusion of a prolonged process aimed at reducing Europe’s energy dependence on Russia.
These steps have forced Moscow to actively redirect energy resource exports to friendly markets. In January 2026, China sharply increased purchases of Russian oil, compensating for the drop in sales to India and Turkey. According to traders' estimates, seaborne supplies of Russian oil to China reached nearly 1.5 million barrels per day – up from about 1.1 million in December – including record volumes of Urals crude for Chinese refineries (over 400,000 barrels per day). At the same time, Russian shipments to India decreased to less than 1 million barrels per day (from about 1.3 million on average in 2025), while Turkey reduced its import of Urals to about 250,000 barrels per day (compared to average 275,000 barrels per day and peak 400,000 in the summer of 2025). The surplus of unsold Russian barrels has increased price differentiation: the discount on Urals in Asia widened to $10–12 relative to Brent, reflecting limited opportunities for redirecting flows.
The drop in purchases of Russian oil by India and Turkey is largely due to sanction restrictions on oil product trading. With the EU banning imports of diesel and other products produced from Russian oil, Indian and Turkish refineries lost part of their markets in Europe and were forced to reduce the share of Russian crude in their throughput. India has previously stated its preparedness to completely replace Russian oil with alternative sources should sanctions tighten: Minister of Petroleum Hardeep Singh Puri noted that the country has planned a diversification of imports in case of secondary U.S. sanctions against buyers of Russian crude. Thus, sanction pressure is gradually reformulating global energy flows: Russia's share in European markets is approaching zero, while Moscow's reliance on exports to China and other Asian countries is steadily increasing.
At the same time, the prospects for easing geopolitical tensions remain elusive. The war in Ukraine continues with no signs of a quick resolution, and diplomatic contacts between Russia and the West have been minimized. Accordingly, energy sanctions are unlikely to be relaxed in the foreseeable future, and companies must adapt to the new long-term trade routes and conditions.
Asia: Demand Rises, Countries Balance Between Imports and Domestic Production
In China, the demand for energy resources remains high, although the growth rate has slowed alongside the cooling economy. The country continues to be the world's largest importer of oil and natural gas but is simultaneously ramping up domestic production and signing long-term deals to diversify supplies. In 2025, Chinese companies signed record contracts for LNG imports (including with Qatar for decades ahead) and increased purchases of pipeline gas from Central Asia and Russia. At the same time, Beijing is making large-scale investments in renewable energy and electric transport, aiming to gradually reduce the economy's dependence on fossil fuels.
India is rapidly emerging as a leader in energy consumption growth. In December 2025, domestic consumption of oil products in the country reached a record 21.75 million tons (approximately 5 million barrels per day), increasing by 5% year-on-year. Experts estimate that India accounted for up to a quarter of the total increase in global oil demand in 2025. The Indian government prioritizes energy security: strategic reserves are being expanded, production from new fields is encouraged, and state-owned refineries established a historic maximum in oil product exports last year. At the same time, the country is increasing renewable energy generating capacity but continues to actively use coal-fired power plants to ensure energy balance. Thus, Asian giants China and India continue to increase their aggregate energy consumption, balancing between rising imports and developing domestic production, making them key players in the global energy market.
Energy Transition: Record RES Performance and Balancing Traditional Generation
The transition to a low-carbon energy system worldwide is gaining momentum. In 2025, many countries recorded record figures in clean energy: for example, the share of renewable sources exceeded 48% in electricity generation in the EU, and total global capacity from solar and wind power plants grew by over 15%. The amount of investment in renewable energy and related technologies (networks, storage systems) also reached historical maximums, surpassing capital investments in oil and gas extraction projects. Major economies (China, the U.S., EU) announced large-scale programs to stimulate green energy and decarbonization aimed at achieving carbon neutrality over a 20-30 year horizon.
However, the rapid growth of RES comes with challenges for energy systems. The variable nature of solar and wind generation requires reserve capacities and energy storage infrastructure. During periods of unfavorable weather (calm, drought), countries are forced to rely on traditional power plants – gas, coal, or nuclear – to ensure stable electricity supply. Many states are postponing the retirement of coal-fired power plants and investing in gas "peaking plants" to balance loads until new energy storage technologies (e.g., industrial batteries, hydrogen solutions) achieve wide deployment. Thus, the global energy balance is undergoing transformation: the share of RES is steadily increasing, but fossil fuels still play a key role in ensuring the reliability of energy supply.
Coal: Global Demand Reaches Historical Peak Ahead of Expected Decline
Despite efforts to decarbonize, the global coal market in 2025 demonstrated record consumption volumes. According to IEA data, world coal consumption grew by about 0.5% and reached approximately 8.8 billion tons – a new historical maximum, mainly driven by increased coal burning in the power generation sector in Asia. China and India, facing growing electricity needs, continue to commission modern coal-fired power plants, compensating for declines in coal demand in Europe and North America. High gas prices in recent years have also prompted some Asian consumers to temporarily switch to cheaper coal.
However, most analysts agree that the current peak in coal demand may be the last. Forecasts from the IEA and other organizations indicate stabilization and gradual decline in global coal consumption by the end of the decade as many RES and nuclear generation facilities come online. Already in 2026, a symbolic reduction in coal demand is expected, primarily due to a substitution in China’s power generation, where the government has set a goal to lower the use of coal in its energy balance. International coal trade is also likely to decrease: key importers are striving to reduce dependence on coal generation, which may weaken the export potential of suppliers such as Australia, Indonesia, South Africa, and Russia. Nevertheless, in the short term, coal continues to play a significant role, providing baseload power in many developing countries.
Russian Oil Products Market: Fuel Price Growth and Stabilization Measures
The domestic fuel market in Russia is experiencing price pressure again at the start of 2026. In the first weeks of January, retail prices for gasoline and diesel continued to rise: according to official data, fuel prices increased by about 1.2-1.3% over just two weeks, significantly surpassing overall inflation. The main factors were the increase in tax burden (as of January 1, the VAT rate rose from 20% to 22%, and excise duties on oil products increased by about 5%) and a relatively limited supply on the domestic market. In 2025, motor fuel prices in Russia increased by 8-11%, exceeding the growth rates of consumer prices, and this trend has continued into the new year, raising concerns among authorities.
The Russian government, together with oil companies, is taking steps to normalize the fuel market situation. The damping mechanism continues to operate, partially compensating producers for the difference between export and domestic prices, although declining export revenues limit the possibilities for subsidization. Monitoring of exchange prices for gasoline and diesel has been intensified, and relevant agencies are demanding producers increase supplies to the domestic market. Earlier, in the autumn of 2025, authorities had already resorted to temporary export restrictions on oil products to lower domestic prices; if the trend of rising prices continues, similar measures may be repeated in 2026. Long-term solutions are also being considered, such as adjusting tax policy or creating minimum fuel reserves to enhance the market's resilience to shocks. Stabilizing prices at gas stations is a priority, given its impact on the socio-economic situation and inflation.
