Current News in the Oil, Gas, and Energy Sector for Monday, January 5, 2026: Oil, Gas, Electricity, Renewable Energy, Coal, Oil Products, Geopolitics, and Key Trends in the Global Energy Market.
Current events in the fuel and energy complex (FEC) on January 5, 2026, attract attention due to a combination of increased geopolitical tensions and sustained market stability. The focus is on the implications of the sharp escalation of the situation in Venezuela following a U.S. military operation that led to a change of power in the country. This event has introduced new uncertainty into the oil market, although the OPEC+ group continues to adhere to its previous production strategy without increasing quotas. This means that global oil supply remains excessive, and until recently, Brent prices held around $60 per barrel (almost 20% lower than a year ago, marking the most significant drop since 2020). The European gas market exhibits relative resilience: even in the midst of winter, gas storage levels in the EU remain high, while record LNG import volumes ensure moderate gas prices. At the same time, the global energy transition is gaining momentum – by the end of 2025, many countries recorded record levels of electricity generation from renewable sources, and investments in clean energy are on the rise. However, geopolitical factors continue to introduce volatility: the sanctions standoff surrounding energy exports remains uncompromising, while new conflicts (such as in Latin America) suddenly alter the power dynamics in the markets. 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: OPEC+ Course Maintained, Geopolitics Intensifies Volatility
- OPEC+ Policy: In its first meeting of 2026, key countries within the OPEC+ alliance decided to keep oil production unchanged, reaffirming the previously stated pause in increasing quotas for Q1. In 2025, participants in the agreement collectively increased production by approximately 2.9 million barrels per day (around 3% of global demand), but a sharp drop in prices in the fall prompted caution. The maintenance of restrictions aims to prevent a further collapse in prices – although the potential for price increases is currently limited, given that the global market remains well supplied with oil.
- Oversupply: Industry analysts estimate that in 2026, global oil supply may exceed demand by 3-4 million barrels per day. High production in OPEC+ countries, along with record output from U.S., Brazilian, and Canadian fields, has led to significant inventory accumulation. Oil is building up both in onshore storage and in tankers transporting record volumes of crude – all indicating market oversaturation. As a result, Brent and WTI prices remained within a narrow range around ~$60 per barrel at the end of last year.
- Demand Factors: The global economy is showing moderate growth, supporting global oil demand. In 2026, a slight increase in consumption is expected – mainly from Asian and Middle Eastern countries, where industry and transport continue to expand. However, economic slowdowns in Europe and a tight monetary policy in the U.S. are restraining fuel demand growth. China plays a particularly significant role: in 2025, Beijing took advantage of low prices and actively increased its strategic oil reserves, acting as a sort of "buffer" for the market. However, in the new year, China's ability to further fill its tanks is limited, making its import policy a decisive factor in balancing the oil market.
- Geopolitics and Prices: Geopolitical events remain a key uncertainty for the oil market. Prospects for resolving the conflict in Ukraine are still cloudy, so sanctions against Russian oil exports remain in place and will continue to affect trade. The new crisis in Latin America – a military action by the U.S. against the Venezuelan government – has reminded the market that political factors can suddenly reduce supply. Against this backdrop, investors are pricing in an increased "risk premium" in oil prices. In the early days of 2026, Brent prices began to rise gradually from ~$60 upwards. Experts do not rule out a short-term price increase to $65–70 per barrel if the crisis in Venezuela prolongs or escalates. Nevertheless, the overall consensus for the year anticipates a continued oil surplus, which will restrain price growth in the medium term.
Gas Market: Stable Supply and Price Comfort
- European Reserves: As of 2026, EU countries entered the new year with high natural gas reserves. By early January, underground storage facilities across Europe were over 60% full, slightly below the record levels of a year ago. A mild winter start and energy-saving measures led to moderate gas withdrawals from storage, ensuring a robust supply for the remaining cold months. These factors are calming the market: wholesale gas prices have been maintained in the range of ~$9–10 per million Btu (around €28–30 per MWh according to the TTF index) — significantly lower than the peaks observed during the 2022 crisis.
- The Role of LNG: To compensate for the sharp reduction in pipeline supplies from Russia (by the end of 2025, Russian gas pipeline exports to Europe had fallen by over 40%), European countries significantly increased their purchases of liquefied natural gas. By the end of 2025, LNG imports in the EU rose by approximately 25%, primarily due to supplies from the U.S. and Qatar, as well as the commissioning of new regasification terminals. The steady inflow of LNG has helped smooth over the effects of reduced Russian pipeline gas and diversify sources, enhancing Europe's energy security.
- The Asian Factor: The balance of the global gas market also depends on demand in Asia. In 2025, China and India increased gas imports to support their industry and energy sectors. However, trade frictions have made adjustments: for instance, Beijing reduced purchases of U.S. LNG, imposing additional tariffs on it, and shifted to other suppliers. If, in 2026, Asian economies accelerate their growth, competition between Europe and Asia for LNG cargoes may intensify, exerting upward pressure on prices. However, for the moment, the situation is balanced, and under normal weather conditions, experts expect relative stability in the global gas market.
- EU Strategy: The European Union aims to solidify its progress in reducing reliance on Russian gas and decrease dependence on a single supplier. Brussels' official goal is to completely halt gas imports from Russia by 2028. Further expansion of LNG infrastructure (new terminals, tanker fleet), development of alternative pipeline routes, and increasing domestic production and biogas generation are planned. Concurrently, the EU is discussing the extension of storage filling requirements for the coming years (at least 90% capacity by October 1 of each year). These measures aim to ensure resilience in case of abnormally cold winters and reduce market volatility in the future.
International Politics: Escalation of Conflicts and Sanction Risks
- The Crisis in Venezuela: The year began with an unprecedented event: the U.S. conducted a military operation against the Venezuelan government. As a result, special forces captured President Nicolás Maduro, who faces charges of drug trafficking and corruption in the U.S. Washington announced that Maduro has been removed from office, and interim control of the country will be transferred to U.S.-backed forces. Simultaneously, U.S. authorities intensified oil sanctions: since December, an effective maritime blockade has been in place against Venezuela, with the U.S. Navy intercepting several tankers carrying Venezuelan oil. These steps have already reduced oil exports from Venezuela: estimates indicate that in December, exports fell to ~0.5 million barrels per day (versus ~1 million b/d on average in the fall). Production within the country continues for now, but the political crisis creates high uncertainty for future supplies. Markets are responding with price increases and a shift in trade routes: although Venezuela's share of global exports is small, the U.S.'s stringent actions send a signal to all importers about the risks of breaching sanctions regimes.
- Russian Energy Resources: Dialogue between Moscow and the West regarding potential easing of restrictions on Russian oil and gas has yet to yield results. The U.S. and the EU have extended existing sanctions and price caps, linking their removal to progress in resolving the situation surrounding Ukraine. Moreover, the U.S. administration has indicated that new measures are being considered: additional sanctions against companies from China and India aiding in the transport or acquisition of Russian oil circumventing established limits are under discussion. These signals maintain an element of uncertainty in the market: for instance, tanker sector freight and insurance costs for oil of questionable origin are rising. Despite the sanctions, Russian oil and refined product exports remain at a relatively high level due to redirection to Asia, but trades are conducted at significant discounts and higher logistical costs.
- Conflicts and Supply Security: Military and political conflicts continue to affect global energy markets. Tensions remain high in the Black Sea region: at the end of December, strikes targeting port infrastructure were recorded amid the confrontation between Russia and Ukraine. Thus far, this has not led to serious disruptions in oil or grain exports through maritime corridors, but the risk for trade routes remains elevated. In the Middle East, the situation in Yemen has escalated: disagreements among key OPEC players, Saudi Arabia and the UAE, have manifested through conflicts involving their allies in Yemen. Although these tensions have not yet hindered cooperation within OPEC+, analysts do not rule out that escalating contradictions could threaten the alliance's unity. A further risk factor has been the recent statements from the U.S. towards Iran: Washington has threatened strikes against Iran amid ongoing protests there, theoretically jeopardizing oil exports from the Persian Gulf. Altogether, geopolitical instability is creating a constant risk premium in the market and prompting participants to devise contingency plans in case of supply disruptions.
Asia: India's and China's Strategies Amid Energy Challenges
- India's Import Policy: Faced with tightening sanctions and geopolitical pressure, India is forced to navigate between the expectations of Western partners and its own energy needs. New Delhi has not formally joined the sanctions against Moscow and continues to purchase significant volumes of Russian oil and coal on favorable terms. Russian supplies accounted for over 20% of the oil imported by India in 2025, and the country considers it impossible to forgo them abruptly. However, by the end of 2025, Indian refineries slightly reduced their purchases from Russia due to banking and logistical constraints: according to traders, in December, deliveries of Russian oil to India decreased to ~1.2 million barrels per day – the lowest level in the past two years (compared to record highs of ~1.8 million b/d a month earlier). Seeking to avoid shortages, Indian Oil Corporation activated a contract for additional oil volumes from Colombia and is negotiating with suppliers from the Middle East and Africa. At the same time, India is seeking special terms: Russian companies are offering Indian buyers Urals oil at a discount of ~$4–5 to Brent price, making these barrels competitive even considering the sanctions risks. In the long term, India is striving to increase its domestic oil production: the state-owned company ONGC is developing deep-water fields in the Andaman Sea, and early drilling results are promising. However, despite efforts to boost domestic production, in the coming years the country will remain dependent on imports for over 85% of its oil consumption.
- China's Energy Security: The largest economy in Asia continues to balance between increasing domestic production and rising energy imports. Beijing has not joined sanctions against Russia and has taken advantage of the situation to ramp up purchases of Russian oil and gas at reduced prices. By the end of 2025, China's oil imports approached record levels, reaching around 11 million barrels per day (only slightly less than the historical peak in 2023). Gas imports – both liquefied and pipeline – also remain high, supplying fuel for the industry and thermal energy during the economic recovery phase. Concurrently, China is annually increasing its hydrocarbon production: in 2025, domestic oil output rose to a historic maximum of ~215 million tons (≈4.3 million barrels per day, +1% year-on-year), while natural gas production exceeded 175 billion cubic meters (+5-6% year-on-year). Although the growth in domestic production has partially met demand, China still imports about 70% of the oil it consumes and around 40% of its gas. In a bid to enhance energy security, Chinese authorities are investing in the exploration of new fields, technologies to enhance oil yield, and expanding capacities for strategic reserves. In the coming years, Beijing will continue to increase its oil state reserves, creating a "safety cushion" in case of market shocks. Thus, the two largest Asian consumers – India and China – are flexibly adapting to the new market conditions, combining import diversification with the development of their resource base.
Energy Transition: Renewable Energy Records and the Role of Traditional Generation
- Growth of Renewable Generation: The global transition to clean energy continues to accelerate. By the end of 2025, many countries recorded unprecedented levels of electricity generation from renewable sources. In the U.S., the share of renewable energy in electricity generation exceeded 30% for the first time, while the combined generation from solar and wind for the first time surpassed output from coal-fired power plants. China maintains its status as the global leader in installed capacity of renewable sources, having commissioned record amounts of new solar and wind power capacity last year. Governments in numerous countries are increasing investments in green energy, upgrading grids, and improving energy storage systems, aiming to achieve climate goals and take advantage of decreasing technology costs.
- Integration Challenges: The rapid growth of renewable energy brings not only benefits but also new challenges. The main issue is ensuring the stability of energy systems with the growing share of variable sources (solar and wind generation). The experience of 2025 highlighted the need for backup capacity: power plants capable of quickly covering peak loads or compensating for declines in renewable generation during unfavorable weather conditions. China and India, despite the large-scale construction of renewable energy sources, continue to commission modern coal and gas-fired power plants to satisfy rapidly growing electricity demand and prevent power shortages. Thus, at this stage of the energy transition, traditional generation still plays a vital role in ensuring reliable electricity supply. For further safe increases in the share of renewables, breakthroughs in energy storage and digital grid management are needed, allowing for even more renewable capacity integration without risking disruptions.
Coal Sector: Steady Demand Amid the "Green" Transition
- Historic Peaks: Despite the global push for decarbonization, world coal consumption reached a new record in 2025. According to the IEA, it exceeded the previous peak set a year earlier, mainly due to increased coal burning in Asia. China and India, which account for two-thirds of global coal consumption, have boosted electricity generation at coal plants to offset fluctuations in renewable generation and meet increasing demand. Meanwhile, several developed countries have continued to reduce coal usage, but a global decline has yet to materialize. Sustained high demand for coal underscores the complexities of the energy transition: developing economies are still not ready to abandon cheap and accessible coal, which provides basic stability in energy supply.
- Outlook and Transition Period: Global coal demand is expected to start significantly decreasing only towards the end of the current decade – as larger capacities of renewable sources come online, along with expanded nuclear energy and gas generation. However, the transition will be uneven: in some years, local spikes in coal consumption may occur due to weather anomalies (e.g., droughts lowering hydropower generation or harsh winters increasing heating needs). Governments must balance emission reduction targets with the necessity of ensuring energy security and affordable prices. Many Asian countries are investing in cleaner coal combustion technologies and carbon capture systems while simultaneously gradually shifting investments toward renewable sources. The coal sector is expected to maintain relative resilience in the coming years before entering a decline in the 2030s.
Refining and Oil Products: Diesel Shortages and New Restrictions
- Diesel Paradox: By the end of 2025, a paradoxical situation emerged in the global oil products market: while oil prices were falling, refining margins—especially for diesel production—sharply increased. In Europe, diesel production yields increased by approximately 30% year-on-year, as demand for diesel remained high while supply was limited. The reasons include the recovery of active transportation and industrial activity post-pandemic, reduced refinery capacities in recent years, and restructuring of trade flows due to sanctions. The European embargo on Russian oil products has forced the EU to import diesel from more distant regions (the Middle East, Asia) at elevated prices, while some other countries are experiencing local fuel shortages. As a result, wholesale prices for diesel and jet fuel remained high at year-end, with retail prices in various regions rising faster than inflation.
- Market Outlook: Analysts expect that high margins in the diesel, jet fuel, and gasoline segments will persist at least in the coming months—until new refining capacities come online or demand starts to significantly decline due to shifts toward electric transportation and other energy sources. In 2026-2027, the launch of several large refineries in the Middle East and Asia is expected to alleviate fuel shortages in the global market partially. At the same time, tightening environmental regulations in Europe and North America (such as sulfur content requirements and increased excise taxes on traditional fuels) might restrain long-term demand growth for oil products. Thus, the oil products market enters 2026 facing a tense balance: supply lags behind demand for certain products, and any unplanned reduction in fuel output (for example, due to refinery accidents or sanctions) could lead to price spikes.
Russian Fuel Market: Continuing Stabilization Measures
- Export Restrictions: To prevent fuel shortages in the domestic market, Russia is extending emergency measures implemented in the fall of 2025. The government has confirmed that the ban on the export of automotive gasoline and diesel fuel will remain in effect at least until February 28, 2026. Experts estimate that this measure retains an additional 200,000-300,000 tons of fuel on the domestic market each month that would have otherwise been exported. This has increased the availability of fuel at gas stations and helped avoid acute fuel shortages during the peak winter consumption period.
- Price Stability: A comprehensive set of measures has allowed for the containment of prices at gas stations. In 2025, retail prices for gasoline and diesel in Russia increased by only a few percent, similar to the overall inflation rate. Authorities intend to continue a proactive policy to prevent price spikes and ensure the uninterrupted supply of fuel to the economy. In anticipation of the spring fieldwork in 2026, the government continues to monitor the market and is prepared to extend restrictions or introduce new support mechanisms as necessary to ensure that the agricultural sector and other consumers are fully supplied with fuel at stable prices.
Financial Markets and Indicators: Energy Sector Response
- Stock Dynamics: At the end of 2025, stock indices of oil and gas companies reflected falling oil prices – shares of many upstream and downstream firms declined amid falling profits within the upstream segment. In Middle Eastern exchanges, reliant on oil prices, a correction was observed: for instance, the Saudi Tadawul index declined approximately 1% in December. Shares of major international companies in the sector (ExxonMobil, Chevron, Shell, etc.) also showed moderate declines by year-end. However, in the early days of 2026, the situation stabilized somewhat: the anticipated OPEC+ decision was already factored into market prices and perceived by investors as a predictability factor. Against this backdrop, as well as rising oil prices due to the Venezuelan crisis, the shares of many oil and gas companies shifted to a neutral-positive trajectory. Should oil prices continue to rise, shares in the oil and gas sector may gain additional upward momentum.
- Monetary Policy: Central bank actions influence the energy sector indirectly through demand dynamics and investment inflows. In several developing countries at the end of 2025, monetary policy began to ease: for example, Egypt's central bank reduced its key rate by 100 basis points in an effort to support the economy after a period of high inflation. Easing financial conditions stimulates business activity and internal demand for energy resources – for instance, the Egyptian stock index rose by 0.9% in the week following the rate cut. Yet in the major economies of the world (the U.S., EU, UK), interest rates remain high to combat inflation. Strict monetary conditions somewhat dampen economic growth and fuel consumption and make borrowing expensive for capital-intensive projects in energy. On the flip side, high yields in developed countries keep some capital on the financial markets of these countries, which limits speculative investments in commodity assets and contributes to relative price stability.
- Currencies of Resource-Exporting Countries: The currencies of major energy exporting states demonstrate relative stability despite oil price volatility. The Russian ruble, Norwegian krone, Canadian dollar, and currencies of Persian Gulf states are supported by high export revenues. At the end of 2025, amid falling oil prices, the values of these currencies weakened only slightly, as the budgets of many resource countries are drawn up based on lower prices, and the existence of sovereign funds, alongside the Saudi Arabia's strict currency peg, smooths fluctuations. Entering 2026 without signs of a currency crisis, resource economies appear relatively stable, positively influencing the investment climate in the energy sector.
