Energy Sector News, Monday, July 28, 2025: Brent Near $70, EU Gas Stores Close to 70%, Gasoline Export Ban

In the latest review of the fuel and energy sector, we examine key events and trends as of July 28, 2025. The global oil market begins the week in a state of relative stability, with Brent trading around $70 per barrel, bolstered by trade agreements between the U.S. and major partners, as well as coordinated actions by producers. European gas storage facilities are being filled at record speeds, now nearing 70% capacity, which lowers the risks ahead of the upcoming winter. In the domestic fuel market of Russia, authorities are finalizing emergency measures to stabilize fuel prices—specifically, a full ban on gasoline exports starting in August, aimed at alleviating shortages. Additionally, we will analyze the situation in the coal sector, the rapid growth of renewable energy (RE), recent changes in electricity supply, and the geopolitical factors reshaping global energy trading. This information will be valuable for investors and stakeholders in the fuel and energy sector—from oil, gas, and fuel companies to electricity, coal, and RE sector specialists.

Oil Market: Price Stability Amid Trade Agreements and Supply Growth

At the start of the week, oil prices maintain relative stability, with Brent trading around $69 per barrel. Market equilibrium is supported by a balance between positive factors and mitigating risks.

• Demand and Trade Agreements. Market participants are encouraged by progress in U.S. trade negotiations. Recently, Washington concluded a major agreement with the European Union, avoiding a tariff war: instead of threatening a 30% duty, a mutual base rate of 15% has been established, and the EU has committed to increasing investments in the U.S. as well as purchasing American energy. Earlier deals were reached with Japan and several other countries, and intensive negotiations with India continue (New Delhi aims to finalize a deal before August 1, when a pause before new U.S. tariffs ends). These moves alleviate concerns about a slowdown in the global economy and support global oil demand. Additionally, the summer vacation season is driving increased gasoline and jet fuel consumption in the U.S. and China. Major producers forecast that global oil consumption will rise by approximately 1.2 to 1.3 million barrels per day in the second half of 2025.
• OPEC+ Supply. The OPEC+ alliance is gradually increasing production after a period of restrictions. In June, production in Russia reached approximately 9.19 million barrels/day, exceeding the established quota (9.05 million) by about 140,000 barrels. Several other large producers (Saudi Arabia, Iraq, UAE, Kuwait) are also exceeding their quotas, although specific participants (e.g., Nigeria) remain below their limits. From April to July 2025, the total OPEC+ quota has been steadily increased by 411,000 barrels/day each month, and a one-time increase of 548,000 barrels/day is set for August. Additional signals indicate increased supply from Venezuela, as U.S. Chevron has received rights to resume production there, potentially reintroducing over 200,000 barrels/day into the market. Thus, rising supply alongside enduring risks of economic slowdown exerts a “cooling” effect on prices.
• Macroeconomic Factors. For the past week, commercial oil inventories in the U.S. have decreased more than expected, reflecting strong demand and preventing prices from dropping sharply. Concurrently, expectations for a easing of monetary policy in leading economies boost investor interest in commodity assets, including oil. The market is also closely watching the OPEC+ Joint Monitoring Committee (JMMC) meeting on July 28; while the committee lacks the authority to change production quotas, its recommendations and signals could influence short-term price dynamics.

Consequently, the oil market enters a new week in a state of relative equilibrium. Brent prices remain at the upper end of the recent months' range, although they remain sensitive to any news about economic risks or changes in OPEC+ policy.

Gas Market: Record Storage Levels Reduce Risk of Winter Price Spikes

The European natural gas market continues to build reserves ahead of the winter season. According to Gas Infrastructure Europe, underground gas storage facilities in EU countries are almost 68% full—an unprecedented level for late July in recent years. In absolute terms, reserves are estimated to be over 74 billion cubic meters, significantly surpassing last year's volumes for the same date. The rate of gas injection is also setting records: in June alone, European companies injected approximately 12.4 billion cubic meters, the highest monthly volume in the past three years. This has been supported by a mild winter and reduced demand, alongside high liquefied natural gas (LNG) deliveries—around 12 billion cubic meters in June (mainly from the U.S., Qatar, and other exporters), which is also a record for a summer month.

Thanks to high reserves and diversified supply, gas prices in Europe are remaining relatively stable during the summer of 2025. Prices at the TTF hub are significantly lower than the peaks of 2022, oscillating within a consumer-friendly range, although the current level still exceeds pre-crisis averages. According to the IEA, wholesale gas prices in Europe for 2025–2026 are expected to remain above $400 per 1,000 cubic meters due to structural market factors; this is noticeably above the historical norm, although substantially lower than the crisis highs. Overall, record storage levels reduce the likelihood of sharp price spikes this winter, which is positively received by investors and industrial gas consumers. Meanwhile, market players are closely monitoring the EU's further steps toward enhancing energy security. Notably, Brussels has extended the regulations for mandatory storage filling for another two years to maintain high reserve levels for future winters, and discussions on potential new restrictions on Russian gas imports are underway at the political level.

Russian Fuel Market: Export Ban and Price Stabilization

The domestic market for oil products in Russia is experiencing a tense situation this summer, driven by a rapid increase in prices for gasoline and diesel fuel. In July, exchange prices for automotive gasoline at the Saint Petersburg International Commodity and Raw Materials Exchange peaked (Grade AI-95 exceeded 75,000 rubles/ton), putting additional pressure on independent gas stations and consumers. Causes include a combination of seasonal factors—high summer demand from farmers and tourists—and supply constraints. Several refineries (refineries) halted operations for scheduled repairs in June and July, reducing gasoline and diesel production. Additionally, some major players, as determined by the Federal Anti-Monopoly Service (FAS), significantly reduced fuel sales on the exchange: the FAS opened a case against a subsidiary of Gazprom for cutting AI-92 gasoline sales by 74% and AI-95 by 50% in late spring, which could have triggered shortages and price spikes.

The government, alongside oil companies, is swiftly developing a package of measures to stabilize the situation. Key actions include:

• Total Ban on Gasoline Exports. The introduction of a temporary embargo on gasoline exports for all producers starting August 1, 2025, for at least one month, is in the final stages of agreement. (Previously, since March, partial export restrictions on gasoline for independent traders were in place; now these restrictions will apply to the entire market to direct additional fuel volumes for domestic needs. If necessary, the ban may be extended until the end of September.)
• Increased Monitoring and Dampening Measures. Monitoring of fuel trading on exchanges has been intensified, and a dampening mechanism has been activated to limit excessive profits from fuel exports (when the export alternative exceeds the baseline level, payments to oil producers decrease, reducing incentives for exporting fuel).
• Mandatory Exchange Sales. Consideration is being given to increasing mandatory exchange sale quotas (from the current 15% of production for gasoline) to enhance market liquidity and saturate the market with supply.

It is expected that in August, the growth of retail fuel prices will significantly slow down as oil companies strive to maintain prices, anticipating the quick lifting of the export ban. However, it seems that restrictions will remain in place in September—lifting is likely only closer to the cold season when demand for fuel begins to decrease.

The market has already reacted to the announced interventions: in the second half of July, wholesale prices stopped rising. As of July 25, AI-92 gasoline decreased by about 1.5% (to ~65,300 rubles/ton), while AI-95 fell by 1.1% (to ~75,400 rubles/ton) in anticipation of the export ban. Although prices are still near record levels, signals of government intervention have shown a trend toward stabilization. Diesel fuel, which has experienced a lesser shortage, has practically not seen price increases.

Experts note that further price dynamics will depend on the duration of export restrictions and the effectiveness of other measures. Administrative steps are likely to prevent fuel price hikes in August–September. However, if the ban is lifted in the fall, a new surge in prices cannot be ruled out if the root causes of the crisis—low gasoline stocks and maintenance downtimes at refineries—are not addressed. The government will have to balance the need to maintain prices in the domestic market with creating incentives for oil producers to prevent fuel shortages during the harvest period and the onset of the autumn season.

Coal Sector: Record Production Amid Modest Demand

The global coal sector is reaching a new production peak in 2025, even as consumption growth slows. According to the IEA's forecast, global coal production this year could reach around 9.2 billion tons—marking a historic high. The primary contribution to this growth comes from China, where boosting domestic coal production remains part of the energy security strategy. Simultaneously, many countries are announcing plans to gradually phase out coal from their energy mix, resulting in demand growing significantly slower than production.

In Russia, coal still holds a significant share in electricity production and exports. The production levels of Russian companies remain near historic highs, with the coal sector actively reorienting toward Asian markets in light of sanctions. The government supports exporters by developing port infrastructure in the Far East and subsidizing railway transport to boost supplies to the Asia-Pacific region. In the future, despite coal's continued significant role, the industry will face modernization and increased environmental demands—considering the global trend toward reducing carbon emissions. In the medium and long term, coal companies will increasingly confront the challenges posed by the "green" transition, although coal will remain essential for ensuring base energy supply in several countries in the coming years.

Renewable Energy: Record Capacity Growth and Environmental Impact

Renewable Energy Sources (RES) continue to rapidly gain traction both globally and in Russia. According to the Renewable Energy Development Association (REDA), over the past year, domestic solar and wind power plants have prevented about 8 million tons of CO₂ emissions. Although the share of RES generation in Russia's energy mix remains small (a few percent), it is growing quickly. In 2025 alone, new wind farms and solar stations are being commissioned—especially many projects have been implemented in the southern regions and the Far East. Pilot initiatives for utilizing energy from small hydropower plants and biofuels are also being launched.

Global trends are showing unprecedented growth rates in "green" energy. The largest investor in this sphere remains China: in the first five months of 2025, around 46 GW of new wind capacity and about 200 GW of solar capacity were installed in China—an unprecedented scale. As a result, more than 90% of all new energy generation capacities installed in China this year come from clean sources. However, to ensure base load, China continues to build modern coal-fired power plants, although coal's share in overall generation is gradually decreasing. In Western countries, renewable energy has practically overtaken coal energy: the variable nature of solar and wind generation is compensated by gas power plants and energy storage systems. All of this indicates a global turning point in the energy sector. Investments are increasingly shifting toward RES, while carbon-intensive industries are forced to adapt to new realities. For energy sector investors, the "green" trend opens up opportunities—from developing solar and wind projects to modernizing grid infrastructure and energy storage systems.

Electricity Sector: Decrease in Generation and Rise in Tariffs

In the electricity sector of Russia, total electricity production in the first half of 2025 showed a slight decrease compared to the same period last year. According to Rosstat, total generation over six months amounted to around 600 billion kWh, which is 1.9% less than the previous year. The main reason for the decline is the low-water year, which significantly reduced hydropower generation.

• Hydropower Plants: ~98 billion kWh (−12% compared to the first half of 2024).
• Thermal Power Plants: ~394 billion kWh (+0.5%).
• Nuclear Power Plants: ~104 billion kWh (−0.3%).

As a result, the share of thermal and nuclear energy in the generation structure has increased, while the contribution of hydropower plants has decreased due to natural conditions.

Another significant event for the sector was the change in electricity tariffs. Starting July 1, 2025, planned price indexing for households and businesses has been implemented: electricity and utility tariffs have increased by an average of 11–12% across the country. This annual increase, prescribed by the government, aims to help energy companies offset inflationary costs and invest in infrastructure maintenance. However, the rise in payments increases the burden on industry and households. In response, authorities have announced support measures: targeted subsidies are being introduced for low-income citizens to mitigate the effects of the tariff increases. Regulators also noted that the pace of tariff growth will slow down in the coming years (e.g., approximately +9% in July 2026). For investors in the electricity sector, tariff increases signal potential revenue growth for energy supply and generation companies, although the government is carefully monitoring to ensure that tariff policy does not drive overall inflation or impede economic growth.

Geopolitics and Energy Resource Trade: Restructuring Global Flows

Geopolitical factors continue to significantly impact global energy resource trade, triggering a redistribution of oil, gas, and coal flows among regions. A notable event is the sharp reduction in energy trade between the U.S. and China amid escalating tensions. In June 2025, China did not purchase oil, LNG, or coal from the U.S. for the first time in nearly three years (according to Bloomberg). Experts link this to rising trade tensions and Beijing's desire to diversify supply sources. China is increasing oil imports from Middle Eastern and African countries, as well as ramping up purchases of Russian crude, taking advantage of price discounts on Urals grade. A similar situation exists with natural gas: significant volumes of LNG are being supplied to China from Qatar, Australia, and the spot market, bypassing American gas.

Concurrently, Europe continues its efforts to reduce dependence on Russian energy resources. The import of Russian oil and petroleum products into the EU has effectively ceased due to the existing embargo, while pipeline gas supplies have been reduced to minimal volumes. The European Union is actively developing infrastructure for LNG reception (new terminals are being constructed, and long-term contracts with alternative suppliers are being signed) to replace the volumes lost. Nonetheless, completely abandoning Russian gas in the short term is challenging for Europe: some countries, such as Hungary, still significantly depend on Gazprom gas under previously concluded contracts. Political disagreements within the EU are manifested in the statements from leaders of these states—for instance, Hungary indicated that it would seek its own solutions directly with Moscow in the event of an EU-wide ban on Russian gas. Such signals highlight the limitations of a unified position within the bloc on energy security.

Overall, there is a transforming landscape of global energy trade influenced by sanctions, trade disputes, and strategic decisions by states. Although currently the pricing environment for oil, gas, and coal is largely determined by fundamental demand and supply factors, political decisions can quickly alter the availability of certain energy sources for entire regions. The energy sectors enter the second half of 2025 in a state of relative balance but with evident signals of forthcoming changes:

• Oil Market: remains relatively stable due to producer coordination but is sensitive to economic risks.
• European Gas Market: approaches winter with record reserves, reducing concerns over sharp price spikes.
• Russian Fuel Market: is increasingly tightly regulated by the government; such "manual" interventions are likely to become the norm in the near future to prevent crises.
• Global Energy Transition: renewable energy is hitting growth records, while the coal industry is peaking ahead of an expected decline.

For investors and companies, this signifies the necessity to adapt to new realities: to respond flexibly to market changes and seek opportunities in rapidly growing segments while remaining vigilant amidst a combination of market and geopolitical factors.