Energy Sector News September 17, 2025 - Sanctions, Oil, Gas, and Fuel Market Stabilization

Main Energy Sector News as of September 17, 2025: Sanction Risks, Oil Market Stability, Gas Sector Preparedness for Winter, Renewable Energy Records, Strong Coal Demand in Asia, and Extension of Fuel Price Stabilization Measures in Russia.

Current developments in the fuel and energy sector as of September 17, 2025, are characterized by a combination of ongoing geopolitical tension and relative stability in raw material markets. Following summer contacts between Russia and the United States, there has been no noticeable breakthrough in relations, and sanction risks remain high. Meanwhile, the European Union unexpectedly postponed the announcement of the new (19th) sanctions package expected today: discussions on measures are continuing within the G7 and will take several more weeks. This highlights the complexities of sanctions-related confrontations, although certain dialogue channels between Moscow and the West remain operational. The global oil market maintains a fragile equilibrium: oversupply and slowing demand keep Brent prices around the higher $60 per barrel mark, reflecting market resilience. The European gas market shows preparedness for winter—gas storage facilities (GSF) in the EU are filled to over 90%, ensuring a buffer before the heating season and keeping exchange prices at a moderate level. In parallel, the global energy transition is gaining momentum: many countries are recording new generation records from renewable sources, though traditional resources are still required for system reliability. In Russia, following a recent spike in fuel prices, authorities continue implementing a set of emergency measures aimed at stabilizing the domestic oil product market. Below is a detailed overview of key news and trends in the oil, gas, energy, and raw materials sectors as of this date.

Oil Market: Oversupply Caps Prices Amid Geopolitical Risks

Global oil prices remain relatively stable as of mid-September, staying within a moderate range. The benchmark Brent blend is trading around $66–68 per barrel, while American WTI is within $62–64. Current quotes are approximately 10% lower than last year's levels, reflecting a gradual normalization of the market after the peaks of the energy crisis in 2022–2023. The price dynamics are influenced by several factors:

• Increased OPEC+ Production. The oil alliance continues to gradually boost supply. At the meeting on September 7, participant countries agreed to another increase in the total production quota starting from October by approximately +137,000 barrels per day (following an increase of +548,000 barrels per day the previous month). Despite relatively low prices, OPEC+ aims to regain lost market shares, leading to an increase in global oil and petroleum product inventories.
• Weak Demand Growth. Global oil consumption is rising much slower than in previous years. The International Energy Agency (IEA) estimates that demand growth in 2025 will be less than 1 million barrels per day (compared to over +2.5 million in 2023). OPEC also predicts modest growth (~+1.2–1.3 million barrels per day). Reasons include a slowdown in the global economy (including reduced GDP growth rates in China) and the effect of high prices from previous years, which have encouraged energy conservation.
• Rising Inventories Outside OPEC. Commercial oil inventories in the U.S. unexpectedly increased in September, signaling a buildup of surplus. At the same time, certain producers are ramping up exports: for example, Saudi Arabia sharply increased oil shipments to external markets after the domestic consumption peak ended. Furthermore, reduced exports of petroleum products from Russia are freeing up additional volumes of crude oil for the global market.
• Geopolitics and Finance. The ongoing sanctions conflict creates nervousness among market participants. The lack of progress in negotiations means that existing restrictions remain in place and the risk of new ones is looming, as stated by Western leaders. At the same time, expectations are rising for a near-term easing of the U.S. Federal Reserve's monetary policy amid weak macro data—this slightly weakens the dollar and temporarily supports commodity prices. Risks of escalating conflicts in the Middle East also persist. Collectively, these factors keep oil quotes within a narrow corridor—without prerequisites for either a sharp rally or a crash.

Gas Market: High Stock Levels in Europe Ensure Price Stability

The gas market is primarily focused on Europe's readiness for the winter period. EU countries have been rapidly injecting natural gas into storage throughout the summer, and by mid-September, GSF filling exceeded 90%. This high stock level ensures a buffer for the energy system before the heating season. Consequently, gas exchange prices remain at relatively low levels: futures contracts on the Dutch TTF hub are around €30–35 per MWh, several times lower than peak values from the previous winter. However, experts warn of potential price volatility in the event of an abnormally cold winter or LNG supply disruptions. Overall, the European gas market appears considerably more resilient than a year ago, reducing risks of energy shortages in the upcoming months.

International Politics: Sanction Confrontation and Its Impact on Energy

The geopolitical situation surrounding the fuel and energy sector remains tense. On one hand, Moscow and Washington declare readiness to maintain contact—separate working communication channels between the governments continue to operate, and new consultations are allowed. On the other hand, there is no real easing of the sanctions regime; moreover, previous intentions to increase pressure have been expressed. An important signal is that the European Union postponed the introduction of the anticipated (19th) sanctions package against Russia, initially expected on September 17, deferring discussions to an indefinite date. According to media reports, this is linked to the necessity of refining measures in coordination with G7 partners, including a U.S. proposal to develop a mechanism for seizing frozen Russian assets. While a temporary pause in sanctions escalation gives the market a brief respite, the risks of introducing new restrictions in the energy sector remain. Western countries are still considering options to intensify sanctions if no progress is made in resolving the conflict. At the same time, direct threats to infrastructure are rising: drone attacks on Russian energy sector facilities have increased in recent weeks, adding uncertainty and anxiety to the markets. Overall, the sanctions confrontation and military risks remain key factors of uncertainty for global energy, restraining investment activity and requiring a realignment of traditional energy resource supply chains.

Asia: The Key Role of India and China in the Energy Markets

Asian countries—primarily India and China—continue to play a crucial role in the global energy resource market, combining increased imports with the development of their own production. **India** maintains a high level of purchases of Russian oil and petroleum products at discounted prices, despite Western pressures to reduce cooperation with Moscow. The Indian government clearly states that it will not compromise on energy security: imports from Russia remain strategically important due to the growing demands of the economy. Simultaneously, New Delhi seeks to diversify sources: long-term contracts are being concluded with the Middle East, LNG purchases are increasing, and domestic investments in oil and gas production are underway. In the short term, rising demand dictates continued large-scale imports, although India must also consider sanction risks—largest Indian corporations are implementing compliance measures to avoid secondary sanctions (for example, some ports are restricting the entry of tankers linked to sanctioned companies).

**China** is also increasing purchases of traditional energy resources—oil, pipeline gas, and liquefied natural gas—while simultaneously boosting domestic production. Beijing has not joined the sanctions against Russia and remains the largest buyer of Russian oil and gas under favorable terms (Russian grades of oil are sold to China at discounts to Brent). According to customs statistics, in 2024, China imported over 212 million tons of oil and approximately 246 billion cubic meters of gas, surpassing the previous year's figures. In 2025, imports continue to grow, albeit at more modest rates due to the high base. Concurrently, national oil and gas companies in China annually renew historical records for hydrocarbon production; however, this is still insufficient to meet domestic demand: the country relies on imports for approximately 70% of its oil and 40% of its gas. In efforts to strengthen long-term energy security, Beijing and Moscow continue to develop cooperation: key parameters of the future "Power of Siberia - 2" gas pipeline to China have recently been agreed, which will significantly increase exports of Russian gas to the Asian market in the future. Thus, Asia remains the main market for Russian energy resources, allowing Moscow to compensate for limited access to European markets.

Energy Transition: New Records in Green Energy and Balance with Traditional Generation

The global transition to clean energy in 2025 is entering a new phase. Many regions around the world are recording record levels of capacity additions and electricity generation from renewable resources (RES). For example, by the end of 2024, EU countries produced more electricity using solar and wind stations than from coal and gas power plants for the first time—this trend continues in 2025 due to the active deployment of new solar panels and wind farms. It is expected that this year the EU will set another record for RES capacity additions (according to estimates from the European Commission, around 85–90 GW of new installations). In the U.S., the share of RES in electricity production has already surpassed 30%, while **China** is annually adding tens of gigawatts of new solar and wind power plants, consistently breaking its own records for green generation. According to IEA data, total investments in the global energy sector in 2025 will exceed $3 trillion, with more than half of that amount dedicated to RES projects, modernization of network infrastructure, and energy storage systems.

Nevertheless, the rapid growth of variable renewable generation presents new challenges. During periods of low sunlight or wind, traditional power plants still require reserve capacity to cover peak demand and prevent outages. Many countries are undertaking large-scale projects to create energy storage systems (industrial battery farms, pumped storage power plants) and implement smart grids to enhance the flexibility of energy systems. Experts predict that by 2026–2027, total generation from renewable sources could surpass traditional coal generation volumes, becoming the largest source of electricity globally. However, for the next few years, traditional resources—such as gas, coal, and nuclear energy—will retain a critically important role as backup sources. Thus, the current stage of the energy transition requires a delicate balance: while green energy records are being achieved and its share is increasing, classic hydrocarbon sources remain essential to ensuring stable energy supply.

Coal: Asian Demand Maintains High Market Levels

Despite the climate agenda, the global coal market in 2025 continues to operate at historically high levels. Global coal consumption remains close to record levels—primarily driven by Asian countries. **China** remains the largest producer and consumer of coal, mining over 4 billion tons per year and burning these volumes at its power plants. During peak periods (e.g., during summer heat and spikes in air conditioning consumption), even this volume can be insufficient: Beijing increases coal imports to avoid electricity shortages. **India** generates over 70% of its electricity from coal-fired power plants, and absolute coal consumption is rising as the economy expands. Several other developing countries in Asia (Indonesia, Vietnam, Bangladesh, and others) are also commissioning new coal power capacities to meet the growing electricity demand.

The largest coal exporters—Indonesia, Australia, Russia, South Africa, and others—have increased production and supplies in recent years. After price spikes in 2021–2022, global prices for energy coal are currently holding at relatively moderate levels, ensuring accessible fuel for energy while remaining profitable for coal mining companies. Many governments announce plans to reduce coal use to fulfill climate commitments; however, in the short term, this resource remains indispensable for reliable electricity supply for hundreds of millions of people, especially in Asia. As a result, the coal sector is in a state of relative equilibrium: demand for coal remains consistently high, while prices are moderate and predictable.

The Russian Oil Products Market: Continuing Emergency Measures and Analyst Commentary

In the Russian domestic fuel and energy sector, unprecedented measures have been implemented in the second half of summer to contain the rising prices of petroleum products. In August, wholesale exchange prices for gasoline and diesel reached historical highs amid surging demand, planned repairs at several refineries, and export profitability. To saturate the domestic fuel market, the government imposed temporary export restrictions on fuel: for major oil companies, the ban on the export of gasoline and diesel has been extended to September 30, while for traders and small suppliers, it extends to October 31, 2025. Refineries are mandated to prioritize supplying products to domestic consumers, increasing shipments to problematic regions (additional fuel supplies have been sent, in particular, to Primorye and Crimea, where shortages were previously observed).

Aside from these immediate measures, authorities are considering long-term stabilization mechanisms for the oil products market. Among them is adjusting the damping mechanism: plans are underway to expand the allowable range of deviation of the exchange price of fuel from the benchmark level at which producers receive compensation. In simple terms, the government is ready to raise the trigger threshold for the "damping" mechanism (currently 10% for gasoline and 20% for diesel) so that refiners can receive payments even with higher domestic prices. This step is intended to reduce the incentive for exports and support the economics of refineries by retaining more fuel in the domestic market.

By early September, the measures taken yielded initial results: after peaks in mid-August, wholesale fuel prices retreated by 7–8%. However, in the second decade of September, price pressures intensified again—exchange prices of gasoline and diesel resumed growth, driven by still-high demand and temporary factors (repeated downtimes of refineries due to repairs and drone attacks). Retail prices for gasoline have increased by more than 7% since the beginning of the year, which is one and a half times higher than overall inflation (~4%). Nonetheless, the government asserts that the situation is under control: filling stations are supplied with the necessary volume of fuel, and new shipments from refineries are arriving regularly. The Central Bank of Russia also expects that as the harvest season concludes and refineries return to operation after repairs, gasoline price growth will slow down. The resumption of crude product exports will only be allowed after the domestic market is fully saturated and there is a sustainable reduction in exchange prices. Thus, the comprehensive measures undertaken aim to gradually normalize the situation. Authorities are ready to extend restrictions and involve additional resources to keep prices for gasoline and diesel at acceptable levels for end consumers.

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