Oil and Gas News and Energy, Thursday, January 15, 2026 — Oversupply in the oil market and a rapid rise of RES

Global News in the Oil, Gas, and Energy Sector for Thursday, January 15, 2026: Oil, Gas, Electricity, Renewable Energy, Coal, Oil Products, and Refineries. Key Events in the Global Energy Market, Trends, and Factors for Investors and Industry Participants.

Global oil and gas markets at the beginning of 2026 are showing signs of increasing oversupply, while renewable energy continues its record growth trajectory. Oil prices remain under pressure due to robust production growth in the U.S. and other regions, with demand for hydrocarbons constrained by a slowing global economy. Simultaneously, governments and companies are ramping up investments in "clean" energy, leading to historic declines in coal usage and the first drop in coal generation in China and India in over fifty years. In this context, investors and industry participants are analyzing the balance of power between fossil fuel oversupply and the prospects of the energy transition.

Global Oil Market

In January, Brent crude is trading around $60–65 per barrel, while U.S. WTI is around $58–60. Prices decreased in Q4 2025 compared to the peak levels of the previous year. Experts forecast that the average Brent price in 2026 will be about $60 per barrel, with WTI around $58. At the January OPEC+ meeting (January 4), it was decided to maintain existing production quotas to limit market volatility. Despite this, fundamental factors indicate an oversupply:

A survey of analysts in December 2025 projected an average Brent price around $61/barrel and WTI at $58/barrel in 2026.
New production from the U.S., Canada, and Latin America has come online, increasing export volumes to the market.
Last week, OPEC+ maintained production levels without cuts, focusing efforts on stabilizing prices instead of artificially raising them.
Russia plans to keep its oil and gas condensate production at 2024 levels (about 10.3 million barrels per day), providing stable supply.

As a result, the outlook for demand and supply balance remains mildly optimistic: even with unplanned disruptions (in Venezuela, Iran, etc.), the oversupply of oil threatens to suppress prices. Meanwhile, global oil futures continue to fluctuate amid geopolitical risks and forecasts of moderate demand. The oil market operates under careful monitoring of OPEC strategies, inventory data, and the state of the global economy.

Overproduction and Geopolitics

According to the International Energy Agency (IEA), in 2026, oil supply is expected to exceed demand by approximately 3–4 million barrels per day, dubbed the "year of global oversupply." Global production has surged in recent years due to shifts in the U.S., Canada, Brazil, and the Emirates. On the other hand, OPEC representatives and some producers consider the market relatively balanced. Key factors contributing to the oversupply and associated risks include:

The IEA predicts a global demand deficit of around 4% compared to production, while OPEC expects a near-equilibrium market.
China is actively replenishing its strategic oil reserves: purchases in the global spot market have increased, partially absorbing the oversupply.
Global oil inventories on tankers have reached peak levels not seen since the 2020 pandemic, indicating a rise in onshore stocks.
Sanctions against Russia and Iran are limiting their oil exports (e.g., U.S. restrictions on tankers), but significant price increases have yet to occur.
Local conflicts (strikes in Venezuela, instability in Libya) create uncertainty regarding supplies, but their impact on the global balance is limited.

Thus, the oil surplus in the market continues to exert downward pressure on prices. Investors are keeping an eye out for signals regarding additional production cuts: while supply currently exceeds demand, a sharp easing of OPEC+ policies or new sanctions could shift the situation in the latter half of the year.

Natural Gas and LNG Market

Seasonal demand is tempering natural gas prices. In the U.S., gas at the Henry Hub is trading around $3–4/MMBtu due to mild winter weather and production oversupply. In Europe, prices remain between $10–12/MMBtu (TTF) due to reduced storage levels and heating needs. The international LNG market is also on the brink of oversupply: in the coming years, dozens of millions of tons of new export capacity will come online. Key trends in the gas sector include:

Global LNG exports are dramatically expanding: by 2026–2027, over 90–100 million tons of new capacity is planned to come online (Qatar North Field, Golden Pass, Scarborough, projects in Africa, etc.), leading to a "seller's market" with excess supply.
According to Bernstein analysts, spot LNG prices may drop from ~$12 to ~$9/MMBtu as new plants come online. The burden of falling prices will largely fall on exporters, while consumers (especially in Asia and Europe) will benefit from cheaper fuel.
The U.S. remains the largest LNG exporter: by 2026–2029, its share could rise to ~70% of supplies to the EU (up from 58% in 2025), considering the EU's plans to phase out Russian gas by 2027–2028.
European gas storage levels are historically low (around 82% of capacity by October), potentially dropping to 29% by the end of the season in cold weather, adding volatility to gas prices.
Gas production from associated gas is increasing in regions like Perm (U.S.) and others: new pipelines to the coast are enhancing gas supply for LNG production and local markets.

In summary, the gas market is balancing between record supply and seasonal demand. Asia generates approximately 85% of the growth in LNG demand, but consumption there has stabilized. Europe, meanwhile, is importing record volumes of LNG in preparation to halt Russian supplies. Despite the oversupply, current cold temperatures and pipeline constraints may keep prices at moderate levels as winter approaches.

Coal Sector

Coal generation in key economies is showing signs of stagnation for the first time. According to energy analysts, coal-fired electricity generation volumes declined in both China and India in 2025 (by 1.6% and 3.0%, respectively). This has been made possible by the record commissioning of solar and wind capacities, which outpaced the growth in electricity demand. Key observations in the coal market include:

For China and India, 2025 marked the first year since 1973 in which overall coal generation fell despite rising energy consumption.
The reason is the rapid growth of "clean" generation: in just eleven months of 2025, solar and wind generation increased by about 450 TWh, covering a growth of 460 TWh in consumption.
Nonetheless, China actively imported coal for the heating season: December coal imports rose 12% year-on-year to meet short-term demand and replenish stock levels.
Global coal prices remain high due to limited development of new mines and sustained demand in several countries (e.g., South Africa and Southeast Asia).
The trend of shifting paradigms is evident: as the growth of renewables continues, the share of coal in the energy balance will gradually decline, potentially leading to a "peak" in coal generation by the end of the decade.

Thus, the coal sector is entering a phase of gradual decline. Despite seasonal demand fluctuations, the long-term role of coal in the global energy landscape is decreasing, while the demand for alternative energy sources is increasing.

Renewable Energy and Electricity

The global energy sector continues to undergo a massive transition towards renewable energy sources and electrification. In 2025, China set a record for the installation of solar and wind capacity (more than 500 GW of new installations in total), which is double any previous figures. However, the International Energy Agency (IEA) has lowered its forecast for global renewable energy growth by 20% by 2030 (to 4,600 GW), citing a slowdown in the U.S. and Europe. Key trends in the electricity sector include:

Electricity demand is rising by about 4% per year until 2027, driven by a boom in data centers, electric vehicles, and climate control solutions in developing economies.
Technological advancements: the costs of solar panels, wind turbines, and batteries continue to decline, enhancing the competitiveness of renewable energy sources and electric transportation.
Network flexibility: due to increased variable generation, operators are intensifying the deployment of smart grids and new load forecasting tools (e.g., AI consumption forecasts). In the face of capacity shortages, larger consumers (data centers) are increasingly investing in on-site generation and battery solutions.
Government policy: despite a trend toward reducing support programs in some countries, overall decarbonization plans in most major economies remain intact. China, the EU, and the U.S. are committed to further developing renewable energy sources, although the pace may vary.

Hence, energy systems are balancing between demand growth and renewable technology development. Capacity reserves are increasing, but enhancing the reliability of networks remains a challenge in 2026, as financial and technological constraints impede a rapid transition.

Oil Products and Refining

The oil products market remains tight in the diesel segment and more balanced for gasoline and jet fuel. European refineries are operating at full capacity, while diesel shortages prompted governments to impose a ban on imports of petroleum products from Russia (starting in 2025) and stimulate increased refining in other regions. Key features include:

Diesel margins continue to rise: in 2025, they surged by approximately 30% due to export restrictions from Russia and diminished supply following infrastructure strikes.
Gasoline and jet fuel margins are more stable, as global demand for flammable fuels remains steady; companies are compensating for discrepancies by increasing supplies from the U.S. and Asia.
Global refining capacities are virtually stagnant: there are few new large refineries, while existing ones are being modernized to meet transitional period needs (including heavy oil processing and biofuel production).
Cross-border projects (e.g., pipelines for cheaper oil grades) have allowed some companies to optimize logistics costs.
In the long term, investors are paying attention to environmental product standards: the mandatory blending of bio-components and requirements to reduce sulfur are increasing, also affecting refinery modernization plans.

Overall, the oil products segment is characterized by steady demand and structural changes: refiners maintain high capacity utilization, while market participants are redirecting some fuel to produce more environmentally friendly blends and other products.

Strategies of Major Oil and Gas Companies

Global oil and gas companies continue to adapt their strategies to new realities: there is a continued caution in spending, alongside a readiness for long-term growth in energy demand. Key trends in the corporate sector include:

Reduction in CAPEX: major players (Exxon, Chevron, TotalEnergies, etc.) have reduced capital spending plans for 2026 by approximately 10%, optimizing projects and securing savings.
BP and Shell: BP announced the write-off of $4–5 billion in low-yield projects in the low-carbon energy segment and has significantly cut budgets for "green" initiatives, focusing efforts on oil and gas production.
At the same time, most companies maintain long-term optimism: investments in exploration and the development of new fields are shifting to the late decade (2030s), while production plans remain substantial.
In the Middle East and Asia, national oil companies (Aramco, ADNOC, CNPC, etc.) are increasing capital expenditures on upstream projects, preparing for long-term demand for hydrocarbons.
Mergers and acquisitions: financially stable companies are considering acquiring competitor assets to take advantage of current market volatility and strengthen their positions.

Therefore, major oil and gas players are demonstrating a balanced approach: short-term focus on strict expense optimization, while long-term expansion of resource bases continues. This creates conditions for potential consolidation and a reevaluation of priorities in developing new technologies and assets.

Outlook and Forecasts for 2026

A balanced conclusion to the winter-spring season of 2026 will be critical for the fuel and energy complex. Most analysts believe that the early months of the year will be characterized by oversupply, and the prospects for price growth will depend on the supply-demand balance and climate conditions. Key conclusions and expectations include:

2026 could become a "year of abundance" for fuel: the oversupply of oil and gas in the first half of the year will put pressure on prices. The average Brent price is expected to be around $55–60/barrel (WTI around $55), with sharp deviations likely only due to new conflicts or supply disruptions.
Demand for hydrocarbons is limited by moderate global economic growth and an accelerating shift to alternatives. Transport and industrial electrification is gradually reducing the growth in oil demand, while the phasing out of coal in energy is generating long-term shifts in fuel balance.
Energy efficiency policies and climate change mitigation influence the strategies of countries and companies: alongside ensuring energy security, there is an increase in climate ambitions (development of renewables, preservation of fossil fuel reserves as strategic resources).
By the end of 2026, markets may gain clarity concerning the balance: if increased supplies offset moderate demand, prices could stabilize at lower levels, providing investors time to rebalance their portfolios.

In conclusion, as of January 15, 2026, the global energy markets are characterized by a surplus of raw materials that are restraining prices, alongside unprecedented growth in "clean" energy. Investors and companies continue to closely monitor the balance between the new "green" paradigm and the traditional oil and gas business model, preparing for changes in the structure of global energy distribution.