Current News in the Fuel and Energy Sector as of September 8, 2025: Stabilization of Fuel Prices in Russia, OPEC+ Decisions, Increased Oil and Gas Exports to Asia, Development of Renewable Energy Sources and Coal Generation. Analysis and Forecast for Investors and Energy Sector Companies.
Current events in the fuel and energy complex (FEC) at the beginning of the week encompass both global trends and domestic market situations. Global oil prices are under pressure from potential increases in production by major exporters, while Russia continues to implement measures to curb rising gasoline and diesel prices. At the same time, cooperation in the gas sector with Asian partners is expanding, and the renewable energy sector is gaining momentum. Let's take a closer look at key news and trends in the oil, gas, and energy sectors.
Global Oil Market: Price Pressures and OPEC+ Actions
The global oil market is witnessing a decline in prices. By early September, the price of Brent crude fell below $67 per barrel, marking the lowest level since the end of August. The primary factor driving this trend is the expectation of increased supply in the market: OPEC+ countries signaled a potential rise in oil production from October, aiming to regain market share. During the alliance's meeting on September 7, a small increase in production quotas was agreed upon – a total increase of approximately 137,000 barrels per day (including around 42,000 bpd attributed to Russia according to the Ministry of Energy). Additionally, data on rising oil inventories in the U.S. and the conclusion of the summer peak demand season are exerting further pressure on prices.
- OPEC+ Decision: Exporting countries agreed to increase production, enhancing expectations for an oversupplied market.
- U.S. Inventories: Reports indicated an unexpected replenishment of oil reserves, signaling a temporary decrease in demand.
- Seasonal Factor: As summer ends, fuel consumption in the transportation sector declines, weakening price support.
- Economic Concerns: Investors also consider the slowdown in China's economy and other countries, which may limit the growth of demand for energy resources.
In the short term, these factors are restraining oil prices. However, market participants will closely monitor further actions by OPEC+ – a more substantial increase in production or a return to limitations could significantly alter the price landscape. For now, prices remain around the mid-$60s per barrel, which is favorable for oil importers but presents new challenges for oil-producing countries.
Russian Oil Exports and Sanction Limitations
The export of Russian oil continues to shift towards eastern markets amid ongoing sanctions. In August, the European Union revised the price cap on Russian oil: the maximum price allowed for maritime trading of the crude oil was lowered from $60 to approximately $50 per barrel. This decision was supported by the United Kingdom, Norway, and Canada, tightening restrictions on transportation and insurance services if the price of Russian oil exceeds the new cap. Despite this, the impact of the price cap remains limited: key buyers in Asia continue to purchase Russian oil at a discount, ensuring a market for Russian crude.
Specifically, India and China have increased their purchases of Russian oil, taking advantage of favorable pricing conditions. Analysts estimate that importing cheaper Russian barrels has allowed India to save around $12 billion over the past year. China is also ramping up imports – reports indicate additional growth in oil exports from Russia to China, facilitated by flexible delivery schemes and routes through neighboring countries. For instance, Rosneft and Chinese partners have agreed to increase transportation of oil through Kazakhstan by 2.5 million tons per year, expanding channels for raw material delivery to Asia. Collectively, these factors indicate that the Russian oil industry is adapting by redirecting export flows to friendly countries and utilizing pricing incentives to attract buyers.
Geopolitical Risks: Oil Transit and Consumer Interests
Geopolitics continues to influence energy markets. Ukraine has announced its intention to prohibit the transit of oil and gas through its territory if the materials are Russian, creating risks for supplies via the Druzhba pipeline to Eastern Europe. At the end of last week, Ukrainian President Volodymyr Zelensky emphasized that he would not extend transit agreements for Russian energy carriers, bringing into question oil security for several EU countries, particularly Slovakia and Hungary.
Slovakia is heavily dependent on Russian oil supplies from the southern branch of Druzhba. Experts estimate that halting transit would significantly harm the country's economy. Alternative routes are limited: Slovakia lacks sea access, and if the pipeline were to stop, it would have to import oil products through neighboring states (such as Hungary or Austria), which is more expensive and logistically complicated. This is likely why the Slovak leadership will strive to maintain transit – the issue is economic rather than political.
Meanwhile, Hungarian authorities openly declare their intention to continue purchasing Russian oil. Hungarian Foreign Minister Peter Szijjarto stated that Budapest operates transparently, while some other EU members are de facto also importing Russian raw materials but do so quietly. Last week, a drone attack on a section of the Druzhba pipeline did not impact supplies – transit was swiftly restored, according to Szijjarto. This situation underscores the crucial nature of stable supplies for dependent countries and how the economy drives pragmatic solutions even amidst sanction-related confrontations.
Domestic Fuel Market: Price Stabilization Measures
In Russia, the issue of rising prices for automotive fuel remains acute. Over the summer, wholesale prices for gasoline and diesel on the Saint Petersburg International Commodity Exchange reached historical highs. In August, exchange prices for AI-95 gasoline first surpassed 82,000 rubles per ton, while AI-92 reached about 72,000 rubles per ton, significantly exceeding last year's levels. This has already been reflected at the retail level: according to Rosstat, in the last week of August, average prices at gas stations rose by another 0.3%, and since the beginning of the year, gasoline prices have increased by approximately 6-7%, outpacing inflation.
The government is implementing additional steps to stabilize the fuel market. The ban on gasoline exports for all companies has been extended until the end of September to redirect maximum volumes to the domestic market. The Ministry of Energy, in cooperation with oil companies, has adjusted schedules for planned repairs at refineries, postponing maintenance from peak demand months to avoid fuel shortages in the summer and early autumn. Simultaneously, reserve capacities are being utilized at existing refineries. These measures are aimed at saturating the domestic market and preventing further price increases at gas stations.
Experts note that the reasons behind the fuel crisis are complex. Key factors include:
- Seasonal Demand: Traditionally, fuel consumption rises during the summer due to car travel and agricultural work, putting additional pressure on prices.
- Reduction of Protective Measures: In 2025, payments to oil producers under the fuel damper significantly decreased – budget compensations for supplies to the domestic market. The reduction in subsidies drives companies to increase wholesale prices to compensate for lost income.
- Unplanned Shutdowns of Refineries: There have been increased instances of unplanned outages, including due to drone attacks on plants. In August, around ten refineries were attacked, temporarily reducing supply and heating up exchange prices.
- Export Appeal: Prior to the ban, the export of petroleum products was more lucrative, leading companies to cut domestic sales. This resulted in a decrease in fuel reserves within the country.
The government is also considering new mechanisms. Regulators are expected to adjust the parameters of the damping mechanism – raising the threshold levels of exchange prices, above which refineries lose compensations. This measure will give companies more opportunities to maintain supplies to the domestic market, even when wholesale prices are temporarily high. Overall, the set of measures is aimed at ensuring that the growth of gasoline prices in the remaining months of the year does not exceed inflation.
Comment: “Regulators will likely opt to raise the threshold levels of exchange prices for fuel, beyond which oil companies lose their rights to damper payments,” stated the CEO of Open Oil Market, Sergey Teryoshkin, in a comment for Kazinform agency. According to his forecast, this measure will help ease tensions in the domestic fuel market, mitigating the impact of rising wholesale prices.
Gas Sector: Expanding Cooperation with Asia
Amid reduced gas supplies to Europe, Russia continues to develop eastern export routes. Important agreements were made with partners in Asia at the Eastern Economic Forum in Vladivostok. In particular, Gazprom and the government of Kazakhstan signed an agreement to increase supplies of Russian natural gas to Kazakhstan in 2025-2026, which will meet the growing needs of the neighboring republic and strengthen the integration of gas systems in Central Asia. It is noteworthy that since October 2023, gas supplies from Russia to Uzbekistan have already commenced via Kazakhstan – now export volumes to the region will be increased.
Energy cooperation with China is also deepening. Gazprom and China's CNPC signed a binding memorandum for the construction of the Power of Siberia-2 gas pipeline. This large-scale project is currently in the design phase, and according to Gazprom's CEO Alexey Miller, its implementation has effectively already begun. The Power of Siberia-2 is expected to connect gas fields in Western Siberia with Western China, potentially delivering up to 50 billion cubic meters of gas annually and raising the overall export potential to China to 100 billion cubic meters.
In addition to the new route, the parties agreed to increase throughput through the already operational Power of Siberia-1 gas pipeline. The capacity of this eastern route will be raised from 38 to 44 billion cubic meters per year, allowing China to receive more gas in the coming years. Simultaneously, supplies via another eastern route (through the Far East) will be increased from 10 to 12 billion cubic meters annually. These initiatives reflect Russia's commitment to redirect gas flows to Asian markets, compensating for reduced exports to Europe. For investors, these agreements signal long-term guarantees for the sale of Russian gas in China’s rapidly growing economy.
Electricity Generation and Renewable Energy Sources
Positive trends have emerged in electricity generation and renewable energy. According to European Commission forecasts, around 89 GW of new renewable energy capacities will be installed in EU countries in 2025 – a record increase reflecting the acceleration of the transition to RES. Significant construction of solar and wind power plants is underway, supporting the EU's drive for energy independence and emissions reduction.
Although Russia lags behind global leaders, it is also increasing its “green” capacities. Industry experts estimate that in the current year, the total installed capacity of RES facilities in Russia may increase by approximately 15%. New wind farms and solar stations are being launched across various regions. There is particular focus on isolated areas: for instance, autonomous energy systems with renewable sources are planned for launch in Chukotka and other remote regions, reducing dependence on expensive imported diesel fuel.
Investments in alternative energy are also coming from foreign partners. The Chinese state company PowerChina is developing projects for building RES generation in Kazakhstan, demonstrating the interest of major players in advancing green energy in Central Asia. Overall, renewable energy is gradually becoming an integral part of the energy balance in the CIS countries. Despite still modest shares in total electricity production (in Russia, RES accounts for about 3% of generation), the growth trend for this sector is clear. This direction is supported by both environmental goals and pragmatism – reducing long-term costs and diversifying the energy mix.
Coal and Traditional Generation
Traditional energy sources continue to maintain their significance. In Russia's coal sector, mining is focused primarily on export to Asia. One of the largest coal mining projects – the Elgaugol company – extracted 18 million tons of coal in the first half of 2025 and plans to reach 36 million tons by the end of the year. High demand for Russian coal from China, India, and other Asian countries supports the industry, compensating for reduced supplies to Europe. Government data indicates that coal exports to friendly countries remain stable or are growing, as coal still plays a key role in the energy supply of many developing economies.
Even within the CIS, coal remains a fundamental fuel for the energy sector. The President of Kazakhstan, Kassym-Jomart Tokayev, recently emphasized that coal generation continues to be a vital foundation of the country's energy system. Kazakhstan, like Russia, is gradually developing renewable sources, but the transition will take years, which is why coal-fired power plants continue to operate to ensure energy supply stability. Similarly, in Russia – while new nuclear power plants are being built and hydroelectric plants modernized, coal still accounts for a significant portion of electricity production, particularly in Siberia and the Far East.
Regarding nuclear energy, it is also experiencing a resurgence of interest. Rosatom is implementing projects for new reactors abroad (in countries from the Middle East to South Asia), expanding the presence of the Russian nuclear sector. Domestically, existing nuclear plants are being upgraded, and preparations for new capacities are underway. Nuclear power generation, together with coal, provides base-load and energy security, complementing the variable nature of RES. For investors, this means that traditional segments of the energy sector – coal, oil, gas, and nuclear – will remain in demand in the foreseeable future, despite the global trend towards decarbonization.
The fuel and energy complex enters the autumn season with a number of challenges and opportunities. Price volatility for hydrocarbons demands participants' attention to OPEC+ decisions and sanction factors. Domestic markets require balancing the interests of producers and consumers, achieved through regulatory measures. Simultaneously, export routes are being reshaped towards the East, and gradual diversification of energy sources is underway through RES. All these processes will determine industry dynamics in the coming months, laying the groundwork for strategic decisions by companies and investors in the FEC.
