Energy and Oil & Gas News for July 23, 2026: Brent Exceeds $94 Amidst Hormuz Strait Blockade, TTF Gas Surpasses €60/MWh, OPEC+ August Quotas, Stabilization of Fuel Market in Russia, LNG, Refineries, Electricity, Renewables, and Coal. Overview for Investors and Energy Sector Participants
The global energy market enters the end of July 2026 in a state not seen by traders since spring: the geopolitical risk premium has fully returned to pricing. The escalation of the US-Iran conflict, the effective halt of shipping through the Hormuz Strait, and the Houthis' maritime embargo against Saudi Arabia have pushed Brent crude oil prices above $94 per barrel — a six-week high. European gas at the TTF hub has risen above €60 per MWh for the first time since March, while underground gas storage injections lag behind last year's schedule. Against this backdrop, OPEC+ maintains a cautious approach to increasing quotas, the Russian fuel market is gradually emerging from a sharp gasoline deficit phase, and the global energy transition confronts a new reality: expensive LNG is bringing coal back into the energy balance in Asia. Below is a detailed overview of key developments in the oil, gas, electricity, coal, and raw material markets for investors and energy sector participants.
Oil Market: Geopolitical Premium Returns to Pricing
Oil prices are experiencing the most aggressive upward movement since early summer. On July 22, the price of the September futures contract for Brent crude oil on the London ICE exchange rose by over 3%, reaching $94.14 per barrel — the highest level since June 11. American WTI rose by more than 3%, approaching $87 per barrel. For comparison, just on July 2, Brent traded below $71, and in mid-June, around $80.5. Thus, within three weeks, the market has rebounded over 30%.
The drivers of the current oil market rally include:
- Blocking of the Hormuz Strait. According to shipping traffic data, no vessels crossed the Strait on certain days last week, through which about one-fifth of global maritime oil trade and a significant share of LNG passes.
- Direct attacks on tanker fleets. Incidents involving the igniting and immobilizing of oil tankers during attempts to navigate the southern route have been recorded, as well as a case where crew members had to abandon their vessel.
- Maritime embargo by the Houthis. Yemeni forces have announced a blockade on supplies from Saudi Arabia, jeopardizing export flows from the largest OPEC producer.
- Expansion of the front. The US is increasing its military presence in the region by deploying additional aviation to bases in Israel, with the market pricing in the risk of Washington's full-scale involvement in the conflict.
- Declining inventories. The IEA has noted a reduction in global commercial oil inventories, increasing price sensitivity to any supply disruptions.
What This Means for Investors
The widening Brent-WTI spread to $7–9 per barrel is a classic indicator that the market is assessing the risk of disruption specifically in Middle Eastern logistics, rather than a global supply deficit as such. For oil companies with a diversified resource base outside the Persian Gulf, this implies a temporary margin expansion. For oil traders and fuel companies, there is a sharp increase in freight and insurance rates, which are already eating into price gains.
OPEC+: Cautious Quota Increases Instead of a Price War
The OPEC+ alliance is maintaining a conservative stance. Following a video conference on July 5, seven countries voluntarily reducing production beyond overall quotas — Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman — agreed to increase August quotas by 188,000 barrels per day. The total quota for the alliance in August will be 36.019 million b/d, with Saudi Arabia and Russia each receiving an increase of 62,000 b/d.
Key parameters of the deal currently include:
- From February to August 2026, the cumulative quota has risen by approximately 940,000 b/d — a volume comparable to the production of a medium-sized participating country.
- The "seven" return to the market restrictions of 1.65 million b/d considering the share of the UAE, which left the alliance in May due to dissatisfaction with quota distribution.
- To fully unwind the voluntary restrictions, the September quotas still need to be increased by another 188,000 b/d. The next meeting is scheduled for August 2.
- Iraq has publicly considered exiting the agreement if its production limit is not increased — a factor highlighting the internal fragility of the alliance.
The dilemma facing OPEC+ in the second half of the year is clear: analysts anticipate a return to structural supply surplus after normalizing the situation in the Persian Gulf. The alliance will have to choose between restraining output for price management and fighting for market share. For now, the current geopolitical premium masks this choice.
Gas Market: Europe Paying a Premium and Lagging Behind Storage Target
The European gas market is under double pressure. Prices at the Dutch TTF hub on July 20 exceeded €60 per MWh for the first time since mid-March, before adjusting to €59 on Tuesday. In dollar terms, the price approached $700 per thousand cubic meters. Since the beginning of July, the European gas benchmark has increased by about 35%, while the Asian JKM Platts index rose by around 25%.
The main issue for the European Union is not so much the price, but the pace of filling underground gas storage:
- The 2025–2026 heating season ended with extremely low inventories: as of April 1, UGS were filled to 27.66% — 13.4 percentage points below the average for the previous five years.
- As of July 19, storage levels reached only 53.7%, which is 15.7 percentage points below the five-year average. The gap is expanding rather than shrinking.
- Daily injections in July decreased to 270 million cubic meters compared to 308 million in June. Last year at mid-summer, the daily replenishment averaged 338 million cubic meters — a quarter more.
- Competition for LNG shipments is shifting in favor of Asia, where liquefied gas is needed for current consumption rather than for replenishing reserves.
Risk Scenario for Fall
Industry experts do not expect a repeat of the highs seen in 2022–2023, but concede that if the conflict in the Persian Gulf continues, prices could exceed $1000 per thousand cubic meters. An additional risk factor is the anticipated peak of El Niño in December, which could alter the heating season profile. For European industry, energy generation, and fertilizer producers, this means the need for hedging right now.
LNG: Record Wave of New Capacity on the Horizon for 2026–2028
Despite the current tension, the medium-term outlook for the liquefied natural gas market looks fundamentally different. According to IEA estimates, the global LNG market is expected to see the largest historical capacity increase between 2026 and 2028. Projects in the US, Qatar, Canada, and several other jurisdictions are ready to come online. Investments in LNG infrastructure are on a stable upward trajectory — unlike investments in oil extraction, which have recorded the first annual decline since 2020 of about 6%, mainly due to cuts in spending in the US shale industry.
Practical implications for market participants: the current price surge is primarily logistical and geopolitical in nature. Structurally, the gas market is heading towards a supply surplus in the second half of the decade, creating an asymmetry between spot prices and long-term contractual expectations.
Gas Demand: IEA Forecasts Decrease in 2026
The International Energy Agency has revised its forecast for global natural gas demand downward. The regional picture has shown varying trends:
- Asia: Demand is expected to decrease by approximately 0.5%. High LNG prices are prompting a switch back to coal for power generation and diminishing activity in energy-intensive industrial sectors.
- Middle East: The most significant decline is projected at around 4% due to the direct impact of conflict on infrastructure and production.
- Eurasia: Growth of about 3%.
- Central and South America: An increase of about 3% amid increased hydropower generation declines.
Price elasticity for gas demand has proven to be higher than anticipated: in response to high prices, consumers in developing economies are quickly reverting to coal. This is the key factor limiting the ceiling on gas prices even under geopolitical stress.
Russian Oil Product Market: Coming Out of Acute Phase of Fuel Crisis
The domestic market for oil products in Russia is undergoing one of its most challenging periods in recent years. The reason is the reduction in primary refining: in June and July, the operations of several major facilities, including the Omsk and Saratov refineries, as well as the NORSI complex, have been suspended or limited due to infrastructure damage and unscheduled shutdowns.
Consequences for the fuel market include:
- Wholesale trading prices for diesel fuel at the SPbMTSB have surpassed historical highs, with trading volumes for AI-95 dropping to 43% during certain periods.
- Several regions have introduced restrictive fuel selling mechanisms, including an "odd-even" scheme; seasonal demand in tourist regions of the Krasnodar Territory, Crimea, and the Caucasus has exacerbated the imbalance.
- Retail prices at major gas station networks remained within inflation limits, while independent gas stations have seen their prices rise significantly.
Regulator Measures and Early Signs of Stabilization
- Export ban: the export of gasoline and diesel fuel is prohibited until July 31, with discussions ongoing regarding possible extensions.
- Exchange sales regulation: the mandatory share of sales through exchanges has been reduced from 15% to 10% to enhance flexibility in direct supply channels.
- Import substitution: Belarus has redirected volumes of gasoline to the Russian market — between June 1 and June 25, imports reached a historical maximum of 141,000 tons. Kazakhstan, which processes 15–17 million tons of oil per year, is also being considered as a potential supplier.
- Resumption of exchange sales: Some refineries have returned to selling fuel on the exchange, wholesale trading volumes are increasing, unsatisfied demand is decreasing, and the situation at some gas stations is stabilizing.
The priority of securing the domestic market remains at the level of the relevant deputy prime minister. Official estimates suggest normalization by August as repairs at the refineries are completed. Industry experts are more cautious and allow for shifts in timelines, noting that supply constraints are temporary: price reductions may be possible in two to three months after resolving processing issues.
Electric Power and Renewables: Record Investments with Growing Flexibility Demands
The global electricity sector is undergoing a structural transformation. Cumulative global energy investments have surpassed $3.3 trillion, with clean technology investments — renewable sources, grids, batteries, and nuclear generation — doubling compared to fossil fuels, which account for about $1.1 trillion. Solar photovoltaic energy has attracted more capital than any other technology in the energy sector. Investments in the energy transition reached $2.3 trillion in 2025.
Key trends in the electricity sector include:
- Renewables and nuclear overtaking coal in the global generation energy balance — a turning point identified in IEA forecasts.
- Data centers as a new demand driver: in North America, electricity consumption growth of around 2% is primarily driven by computing infrastructure and AI workloads.
- Asia setting the pace: India is demonstrating a demand growth for electricity of approximately 6.6% — the largest contribution to global dynamics.
- Nuclear renaissance: more than a hundred reactors in France and the US are ensuring record levels of nuclear generation, and Japan is consistently bringing back online previously stopped units.
- Flexibility deficit: the increasing share of variable generation requires proactive investments in energy storage systems and grid modernization — without them, reliability of supply diminishes.
Coal: The Last Resort Fuel Returns to Play
Despite the long-term trend towards decarbonization, the coal market has received short-term support from the gas crisis. The mechanism is direct: expensive LNG in Asia makes coal generation economically preferable, as evidenced by regional gas demand declines. Developing economies in the Asia-Pacific region continue to rely on coal as a tool for meeting baseload demand and ensuring energy security.
For investors, this creates a characteristic asymmetry: coal assets demonstrate strong cash flows during periods of energy stress but remain under structural pressure from climate regulations and capital costs. The largest exporters — Indonesia, Australia, Russia, and South Africa — maintain the capacity to rapidly increase supplies, which limits the potential for price rallies in the coal market.
Commodity Sector and Logistics: Insurance Premiums as a Hidden Tax
The transformation of transportation and logistics costs deserves special attention from market participants. The military threat in the Hormuz Strait is being transmitted to the market through several channels:
- Freight rates for VLCC-class tankers are rising as the number of shipowners willing to operate in the risk zone decreases.
- Insurance premiums for war risks are being adjusted upwards, effectively creating an additional tax on every barrel of Middle Eastern oil.
- Route extensions and reorientation of flows increase fleet turnover times, reducing the effective supply of tonnage.
- Re-evaluating delivery premiums in favor of producers outside the Persian Gulf — West Africa, Latin America, and the North Sea.
Governments in several countries are already preparing for possible disruptions in energy resource supplies by revising the parameters of strategic reserves. Simultaneously, regional intermediaries are attempting to negotiate a ten-day ceasefire between Washington and Tehran, which could serve as a foundation for new negotiations. Tehran is considering the proposal, but no final agreement has yet been reached.
Forecast and Conclusions for Energy Sector Participants
The current configuration of the global energy market is characterized by the overlay of a short-term geopolitical shock over a medium-term trend towards supply surplus. Practical guidelines include:
- Oil: The range of $85–95 per barrel for Brent will persist until clarity emerges regarding shipping conditions in the Hormuz Strait. Achieving a ceasefire agreement could quickly remove the premium by $10–15.
- Gas: TTF prices expected in the €55–65 per MWh range, with risks of exceeding this during an unfavorable fall scenario. The key indicator to monitor will be the daily injection rates into European UGS.
- Oil Products in Russia: Gradual restoration of balance as repairs at refineries are completed; the issue of extending the export ban beyond July 31 remains the main regulatory risk.
- Electricity: The investment focus is shifting from generation to grids, storage, and sources of flexibility — this is where the deficit is forming.
- Coal: Tactical support from expensive gas while retaining long-term structural pressures.
For investors, fuel, and oil companies, a key skill in the current environment is not to forecast price direction but to manage volatility: revising hedging strategies, stress-testing logistics chains, and reassessing counterparty risks in areas of heightened military danger. The energy market has entered a phase where the speed of response is more important than the accuracy of predictions.
