Key Themes of the Day: What Drives the Energy Agenda on August 12, 2026
- Oil: Brent rose above $90 per barrel for the first time since July 31; WTI was trading around $84. The driver is the risk of prolonged crisis around the Strait of Hormuz.
- Geopolitics: Washington has set new demands for Tehran, including compensation for years of damage, complicating the deal for normalizing shipping in the Persian Gulf.
- Gas: European gas storage levels are nearly 17 percentage points below the five-year average; injection rates are among the worst since 2011.
- OPEC+: The alliance has raised quotas for August and September by 188,000 barrels per day and is preparing to pause production increases.
- Russia: The ban on gasoline exports has been extended until January 31, 2027, amid ongoing tensions in the domestic fuel market.
- Macro: Markets are awaiting the release of U.S. inflation data; the CPI report could set the direction for all commodity assets for the rest of the week.
The Oil Market: Brent Above $90 — Risk Premium Returns
Oil prices ended Tuesday with a sharp rise of over 2.5%: October Brent futures peaked at $90 per barrel, while September WTI contracts reached $84.4. The formal trigger was the hard rhetoric from the White House: the U.S. president stated that Iran must compensate for the damage caused over decades of confrontation and emphasized that U.S. forces control the Strait of Hormuz and conducted its demining. The market interpreted these statements as a signal that a swift agreement to restore free shipping would not occur.
Volatility remains extreme: just at the end of last week, Brent dropped to $83 on hopes for progress in negotiations, only to rebound by about $7 over two trading sessions. Traders are incorporating a significant geopolitical premium into prices, as about 15% of global oil passes through the Strait of Hormuz. An additional note to the market picture is that U.S. imports of Saudi oil have fallen to zero for the first time since 1985: the Middle Eastern crisis has radically reshaped global commodity flows. Meanwhile, oil and gas majors are reporting tens of billions of dollars in additional profits for the first half of the year.
The Strait of Hormuz: Trading Around the World’s Main Oil Corridor
The key narrative for the commodity market in 2026 is the fate of the Strait of Hormuz. After effectively blocking the corridor, Tehran is showing readiness to discuss the resumption of transit, but on its own terms:
- Iran seeks to impose a fee of 5–7% on the cargo value for vessels using the strait;
- Oman, looking to act as a mediator, discusses a compromise rate of around 3%;
- Legislation banning the passage of American and Israeli vessels is being considered in the Iranian parliament;
- The proposed Iran-Oman agreement for joint control over the strait effectively gives Tehran leverage over all vessels entering the Persian Gulf.
Despite the blockade, Iran is increasing its oil exports through a "shadow" fleet and complex payment schemes. Analysts warn that the longer the uncertainty persists, the higher the risk that oil price spikes will amplify the financial and macroeconomic vulnerability of the global economy.
OPEC+ Without the UAE: Final Step in Increasing Quotas and a Pause Ahead
The oil alliance continues its cautious strategy of increasing supply. Seven OPEC+ countries — Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan, and Oman — have raised quotas in August by 188,000 barrels per day and have agreed on a similar step for September, which will mark the final stage of the removal of voluntary restrictions of 1.65 million barrels per day. From February to August, the cumulative quota increased by about 940,000 barrels per day. Going forward, the alliance intends to take a pause: complex negotiations regarding quota distribution for 2027 are ahead, while reductions of about 2 million barrels per day remain in place since 2022.
Internal contradictions are mounting: since May 1, 2026, the United Arab Emirates has exited OPEC and OPEC+, and Iraq publicly allows for a similar step, demanding an increase in its individual production limit. Under the August quota, Russia may increase production to 9.887 million barrels per day. For investors, the key question is whether the alliance will maintain discipline and unity in the face of high prices and centrifugal tendencies.
Gas Market: Europe Enters Winter with Minimal Stocks in Years
The European gas market is the main source of concern for energy sector players ahead of the autumn-winter season. EU gas storage is only about 59% full — nearly 17 percentage points below the five-year average. Injection rates in July were among the lowest since 2011 due to lost competition with Asia for free LNG volumes during the Middle Eastern conflict, high fuel prices, and an abnormal heatwave that increased electricity consumption for cooling. LNG imports in August are expected to be at 6.3 million tons — 16% lower than last year.
TTF hub prices remain in the range of €41–44/MWh (over $500 per thousand cubic meters), and by the end of July, prices had risen by about 55%. To meet the European Commission's norm of 90% full storage by the start of winter, the region needs to inject at least 68 billion cubic meters net, and achieving this goal is in question. A cold winter with the current balance could trigger a new round of price rallies in the global gas market.
Electricity and Renewables: Record ‘Green’ Share Fails to Prevent High Electricity Prices
The paradox of the European energy transition is vividly demonstrated by Germany: the share of renewable energy in generation reached 71%, up from 65% in 2024; however, the average daily electricity price in August rose to €114/MWh — approximately 40% more than last summer. Reasons include heatwaves, reduced output from French nuclear power plants, and expensive gas, which closes peak demand. The energy system, not backed by adequate storage, is increasingly struggling to balance record outputs from solar and wind.
Global trends remain unchanged: according to the International Energy Agency, by 2026, renewables will surpass coal in global electricity generation. In the first half of the year, renewables accounted for 45.5% of generation in the EU, while China continues to add record amounts of solar and wind capacity, developing energy storage systems and a “green” certificate market.
Coal: Expensive Gas Extends the Life of Traditional Generation
High gas prices are again enhancing the competitiveness of coal. The IEA expects that CO₂ emissions from electricity generation will rise by about 1% in 2026 due to the increased coal generation, with stabilization expected only from 2027 onwards thanks to the expansion of renewables and nuclear energy. The demand for thermal coal remains robust in Asia: China and India use coal-fired power plants as a safeguard during peak consumption periods, while exporters — Indonesia, Australia, Russia, and South Africa — maintain stable supply volumes.
Russian Fuel Market: Export Ban Until 2027
The domestic market for petroleum products in Russia remains under manual control. The government has extended the complete ban on gasoline exports until January 31, 2027, applying it to all producers; in July, the regime on diesel fuel exports was further tightened. These measures are aimed at saturating the domestic market after months of fuel tension; however, wholesale and retail prices continue to rise. The baseline scenario assumes stabilization and price growth within inflation; the negative scenario anticipates a local deficit and an increase in A-95 prices to 65–67 rubles per liter. Non-standard solutions are also being discussed, including the processing of Russian oil at Kazakh refineries with partial return of fuel to the Russian market. Experts do not expect significant price reductions before the fourth quarter — assuming uninterrupted operations of large refineries.
What This Means for Investors: Scenarios and Benchmarks
The environment promises to be eventful: markets are awaiting U.S. consumer inflation data, which will influence expectations for the Fed's rate and, consequently, the entire commodity complex. For energy sector participants, the key benchmarks for the upcoming weeks are as follows:
- Oil: The range of $83–95 per barrel for Brent is maintained; any news regarding the Strait of Hormuz can shift prices by several dollars per session;
- Gas: Europe’s lagging storage injection makes winter TTF futures vulnerable to weather and geopolitical shocks;
- OPEC+: A pause in quota increases and negotiations on limits for 2027 — a price-support factor in the second half of the year;
- Electricity: The deficit of flexible generation in Europe maintains high spot prices and interest in investment in storage;
- Risks: Escalation in the Middle East, breakdown of U.S.-Iran negotiations, and a cold winter in Europe are the main catalysts for a new price rally.
The energy market as of August 2026 lives in a new reality: geopolitics has once again become the main pricing factor, and the resilience of the global energy system has noticeably diminished. In these circumstances, the risk premium in prices for oil, gas, and electricity is likely to persist for a long time.
