News in Oil & Gas and Energy — Monday, January 19, 2026: New Round of Sanction Pressure, Oil Surplus, and Record LNG Imports. Oil, Gas, Power, Renewables, Coal, Oil Products, Refineries — Key Trends in the Global Fuel and Energy Sector for Investors and Market Participants.
The beginning of 2026 is marked by the continuation of geopolitical tensions and large-scale restructuring of global energy resource flows, attracting the attention of investors and market participants. Western countries are not easing the sanctions pressure on Russia: the European Union is preparing a new package of restrictions in the energy sector, aiming to completely abandon Russian oil and gas. At the same time, the global oil market continues to experience an oversupply situation—slow demand growth and the return of certain producers (such as the gradual recovery of production in Iran and Venezuela) are keeping Brent prices around $60 per barrel. The European gas market is weathering the winter demand peak thanks to record LNG imports and diversification of supply (including new volumes of gas from Azerbaijan), allowing price increases to be contained even as Russian pipeline exports decline. The global energy transition is gaining momentum: in 2025, record renewable energy capacities were installed, although traditional resources remain essential for the reliable operation of energy systems. In Asia, demand for coal and hydrocarbons remains high, supporting the global commodity market, while in Russia, after last year's gasoline price spike, authorities are extending emergency export restrictions on oil products to maintain stability in the domestic fuel market. Below is a detailed overview of key events and trends in the oil, gas, energy, and commodity sectors as of this date.
Oil Market: Supply Surplus Limits Price Growth
Global oil prices at the start of 2026 are being held at moderate levels due to the persistent supply surplus. The benchmark Brent is trading around $60–65 per barrel, while American WTI fluctuates between $55–60. These price levels are approximately 10–15% lower than a year ago, reflecting a gradual correction following the peaks of the energy crisis in 2022–2023. There is an excess of oil in the market of about 2–2.5 million barrels per day, as OPEC+ countries increased production in the second half of 2025 in an attempt to regain lost market shares. Additionally, supply from the U.S. (with shale oil production remaining high) has risen, and some volumes from previously sanctioned countries—including Iran and Venezuela—have partially returned as export capabilities increase following the easing of some restrictions. Meanwhile, global demand growth remains restrained: the slowdown of the Chinese economy and energy-saving effects following a period of high prices limit oil consumption growth. Analysts estimate that without a significant demand revival or new actions from producers, prices may fall to $55 per barrel in the first half of 2026. A key factor is OPEC+ policy: if the alliance does not cut production and continues its previous course, prices will remain under pressure. Leading exporters are unlikely to allow a market crash and may again limit supply if necessary to support prices. Geopolitical risks also persist, but have yet to lead to supply disruptions: a recent easing of tension in the Middle East quickly eliminated any price "premium," and oil quotes soon returned to previous values. Thus, the oil market is creating a situation near equilibrium, although the balance is tilted in favor of buyers—excess supply and moderate demand do not allow prices to rise significantly.
Gas Market: Winter, LNG, and New Routes Replace Russian Supplies
The European gas market entered 2026 under drastically new conditions—virtually devoid of pipeline gas from Russia. As of January 1, the EU ban on most of such supplies came into effect, and Europe had prepared for this step in advance. EU countries filled underground gas storage (UGS) facilities to over 90% by the start of winter; by mid-January, stocks had decreased to about 55–60% capacity, still above the average levels of previous years. Despite the severe cold, gas withdrawal from UGS is proceeding smoothly and without panic, with exchange prices remaining significantly lower than the peaks of 2022.
The main reason for stability is the record import of liquefied natural gas (LNG). European LNG terminals are operating at maximum capacity in January: daily regasification volumes exceed 480 million cubic meters, breaking previous historical records. Such an influx of LNG offsets the cessation of Russian transit and keeps gas price growth in check. Although spot quotes in Europe have risen by 30–40% since the beginning of the month due to the cold, they still remain far from the extreme values of the energy deficit in 2022. To meet demand in the context of restricted supplies from Russia, Europeans rely on several directions:
- maximizing pipeline gas supplies from Norway and North Africa;
- increasing LNG imports from the U.S., Qatar, and other countries;
- expanding the utilization of the Southern Gas Corridor (supplies from Azerbaijan to EU countries);
- reducing domestic consumption through energy-saving measures and improving energy efficiency.
The combination of these measures allows Europe to confidently navigate the current heating season even without Russian gas. Moreover, Russia is reorienting its exports towards the East: Gazprom reported record daily gas supply volumes to China via the "Power of Siberia" pipeline in January. Regarding the global market, seasonal demand is also increasing in Asia: key importers in Northeast Asia are ramping up LNG purchases, and the Asian JKM index has risen to ~$10 per MMBtu (the highest in the last month and a half). Nevertheless, the global gas balance remains stable: flexible redistribution of flows between regions and increasing production (especially in the U.S., where Henry Hub prices remain around $3 per MMBtu) enable coverage of the rising demand. In the coming weeks, the gas market situation will largely depend on the weather: even if the cold persists, Europe has sufficient gas reserves and import capabilities to avoid a supply crisis.
International Politics: Sanctions, New Deals, and Redistribution of Flows
The sanctions confrontation between Moscow and the West in 2026 is further developing. At the end of 2025, the EU approved the 19th sanctions package, a significant portion of which targeted Russian energy—specifically, a decision to lower the price cap on Russian oil starting in February 2026 and accelerate the phase-out of LNG imports from Russia (a ban on purchases from 2027). At the start of 2026, Brussels announced preparations for the next step: a legislative ban on remaining volumes of Russian oil imports into EU countries is planned, as well as the implementation of an reached agreement for the complete cessation of Russian pipeline gas purchases. Meanwhile, the United States and the European Union are enhancing oversight of compliance with existing restrictions: fall saw the U.S. Treasury introduce additional sanctions against oil companies Rosneft and Lukoil, while European authorities are tightening monitoring of the tanker fleet transporting Russian oil bypassing set rules. Russia, for its part, has extended the embargo on oil sales to countries participating in the price cap until June 30, 2026.
The export of Russian oil and oil products is being maintained at a relatively high level due to redirection of flows to Asia. China, India, Turkey, and several other countries continue purchasing Russian hydrocarbons at a significant discount to global prices. As a result, the global energy market is effectively divided into two parallel contours: the “Western” one, where sanctions and restrictions are applied, and an alternative one, where Russian raw materials find a market, albeit at reduced prices. Investors and traders are closely monitoring the sanctions policy, as any changes impact logistics and pricing dynamics across the markets.
At the same time, elements of flexibility have emerged in the West's sanctions strategy regarding certain countries. For instance, with political changes in Caracas, the U.S. signals its readiness to accelerate the removal of oil sanctions against Venezuela. International companies have already received extended licenses to operate in Venezuela: in the coming months, Chevron and other operators will be able to significantly increase exports of Venezuelan oil. Additionally, Venezuela has signed its first contract for natural gas exports, marking a new chapter for its energy sector. Experts note that the recovery of Venezuela's oil and gas industry will be gradual—years of inadequate investment and sanctions have severely curtailed its production capabilities. Nevertheless, the fact that additional volumes from Venezuela are returning to the market strengthens consumer confidence and exerts downward pressure on price growth expectations. Geopolitical tensions in the Middle East have also notably decreased: by mid-January, unrest in Iran had subsided, and Washington’s tough rhetoric regarding potential strikes on Iran had softened. As a result, the risks of sudden supply disruptions of Middle Eastern oil have temporarily diminished. Thus, the beginning of 2026 is characterized by the contradictory influence of politics on energy markets: on one hand, sanction pressure on Russia remains high; on the other hand, localized de-escalation in some regions and selective easing of restrictions (such as with Venezuela) create a more favorable environment than previously anticipated.
Asia: India and China Navigate Between Imports and Development of Production
- India: Despite pressure from Western partners to reduce cooperation with sanctioned suppliers, Delhi has only moderately decreased purchases of Russian oil and gas in recent months. A total cessation of these resources is deemed impossible by India due to their crucial role in national energy security. The country continues to receive raw materials from Russian companies at preferential terms: the discount on Urals oil for Indian buyers is about $4–5 to Brent prices, making supplies quite attractive. As a result, India remains one of the largest importers of Russian oil while simultaneously increasing imports of oil products (such as diesel) to satisfy growing domestic demand. Concurrently, the Indian government is ramping up efforts to reduce dependence on imports in the future. Prime Minister Narendra Modi has announced an extensive program for exploring deepwater oil and gas fields on the continental shelf. The state-owned company ONGC is already drilling ultra-deep wells in the Bay of Bengal and the Andaman Sea; initial results are considered promising. This initiative aims to unlock new large hydrocarbon reserves and bring India closer to its long-term goal of energy self-sufficiency.
- China: The largest economy in Asia continues to increase energy consumption, balancing enhanced imports with rising domestic production. Beijing has not joined Western sanctions against Moscow and has leveraged the situation to increase purchases of Russian energy carriers under favorable conditions. Analysts estimate that in 2025, oil and gas imports into China rose by 2–5% compared to the previous year, exceeding 210 million tons of oil and 250 billion cubic meters of gas, respectively. Growth rates have slowed somewhat from the spike in 2024 but remain positive. At the same time, China is setting records for domestic production: in 2025, national companies extracted over 200 million tons of oil and about 220 billion cubic meters of natural gas, representing a 1–6% increase over last year’s levels. The government actively invests in the development of difficult-to-access fields, the implementation of new technologies, and the increase in oil recovery from mature fields. Nevertheless, given the scale of the Chinese economy, dependency on imports remains significant: about 70% of consumed oil and roughly 40% of gas must still be purchased abroad. In the coming years, these proportions are unlikely to change significantly. Thus, the two largest Asian consumers—India and China—continue to play a crucial role in global commodity markets, navigating the necessity to import massive fuel volumes while aspiring to enhance their own resource base.
Energy Transition: Renewable Energy Records and the Importance of Traditional Generation
The global shift to clean energy reached new heights in 2025, establishing significant benchmarks for the industry. Many countries set record capacities for solar and wind generation, leading to historic highs in renewable energy production. In the European Union, total generation from solar and wind power plants surpassed electricity production from coal and gas power plants for the first time by year-end, solidifying the shift in balance towards “green” energy. In countries such as Germany, Spain, the UK, etc., the share of renewables in electricity consumption regularly exceeded 50% on certain days thanks to the addition of new capacities. In the U.S., renewable energy also reached record levels; at the start of 2025, over 30% of total generation was attributed to renewables, and the aggregate volume of electricity produced from wind and solar surpassed that generated by coal power plants. China remains the world leader in the scale of "green" construction—in 2025, the country introduced dozens of gigawatts of new solar panels and wind installations, continuously updating its records for clean energy production. Leading oil, gas, and power corporations, taking these trends into account, are continuing to diversify their business: significant investments are being directed towards renewable energy projects, the development of hydrogen technologies, and energy storage systems.
However, the impressive progress in the clean energy sector requires maintaining a balance with traditional generation. The past year showed that during peak demand periods or adverse weather conditions (e.g., winter during calm wind and weak solar generation), backup fossil fuel capacities remain critically important for ensuring reliable energy supply. In Europe, where coal’s share has significantly decreased in recent years, certain coal power plants were reactivated during severe cold spells, while gas power plants took on increased loads amidst inadequate wind generation. In Asian countries, retaining base coal generation secures the energy system against disruptions during consumption surges. Consequently, while the world is rapidly transitioning towards cleaner energy, it remains far from full carbon neutrality. The transitional period is characterized by the coexistence of two models—the rapidly growing renewable and the traditional thermal energy that acts as a safety net and smooths seasonal and weather fluctuations. The strategy of many governments entails the parallel development of renewables and the modernization of conventional infrastructure, which should ensure the resilience of energy systems on the pathway to a low-carbon future.
Coal: Asian Demand Keeps the Market at a High Level
Despite efforts for decarbonization, the global coal market remains characterized by significant consumption volumes and relatively stable prices. Demand for coal remains high, especially in Asian countries. In China and India—two of the largest consumers—this resource continues to play a key role in electricity generation and metallurgy. According to industry reports, global coal consumption in 2025 remained near historical highs, decreasing only 1–2% compared to the record levels of 2024. The growth in coal use in developing economies offsets the reduction in its share in the energy balance of Europe and North America. Many Asian nations are still commissioning new highly efficient coal power plants to meet the growing energy demands of the population and industry.
The pricing situation in the coal market is currently calmer than during the peak energy crisis: energy coal quotes at the beginning of 2026 are in the range of approximately $100–110 per ton, significantly lower than the highs of two years ago. Price easement is supported by increased supply—leading exporters (Indonesia, Australia, South Africa, Russia, etc.) have ramped up production and export, while consumption in Europe decreases with the development of renewables and the return of nuclear generation to operations. Europe continues its systematic phase-out of coal: a telling event was the closure in January of the last deep coal mine in the Czech Republic, marking the end of a 250-year history of coal mining in that country. Nevertheless, on a global scale, coal remains an important component of the energy balance. The International Energy Agency predicts that in the coming years, global coal demand will plateau, with a subsequent gradual decline. In the long term, tightening environmental policies and competition from cheap renewables will constrain the development of the coal sector; however, in the short term, the coal market will continue to rely on persistently high Asian demand.
Russian Market: Export Restrictions and Fuel Price Stabilization
Within the Russian fuel and energy complex, unprecedented measures are in place to normalize the pricing situation. After wholesale prices for gasoline and diesel fuel soared to record levels in August 2025, the Russian government imposed a temporary ban on the export of major oil products. These restrictions have been repeatedly extended and are currently in place at least until February 28, 2026, covering the export of gasoline, diesel, fuel oil, and gas oils. The cessation of exports has allowed significant volumes of fuel to be redirected to the domestic market, which notably decreased exchange prices by winter. Wholesale prices for oil products have dropped by tens of percent from peak levels, and the growth of retail prices at gas stations has slowed—by the end of the year it was about 5%, fitting within the general inflation framework. Thus, the fuel crisis has largely been contained: there is no gasoline shortage at gas stations, panic buying has subsided, and prices for end consumers have stabilized.
However, the cost of these measures has been a reduction in export revenues for oil companies and the budget. Russian oil producers are forced to accept lost profits to saturate the domestic market. Authorities assert that the situation is under control: the production cost of oil at most Russian fields is low; therefore, even with prices below $40 per barrel for Urals, most projects remain profitable. Nevertheless, the decline in export revenues—overall, oil and gas revenues to the Russian budget fell by about a quarter in 2025 compared to the previous year—creates risks for launching new investment projects that require higher global prices and access to external markets. The state does not directly compensate companies, but continues the operation of the damping mechanism (reverse excise), which partially reimburses lost revenues from domestic fuel sales.
The Russian fuel and energy complex is adapting to the new conditions of the sanctions era. The main task for 2026 is to maintain a balance between curbing domestic energy prices and retaining export revenues, which are vital for budget replenishment and financing industry development. The government emphasizes its readiness to extend restrictions on oil product exports or introduce new instruments if necessary to prevent shortages and price shocks for the population. Concurrently, measures are being developed to stimulate processing and find new sales markets for raw materials. So far, the steps taken have ensured stable fuel supply within the country and maintained prices at a consumer-friendly level. Control over the situation in the fuel sector remains one of the government’s policy priorities, as it directly impacts socio-economic stability and the resilience of Russia's oil and gas complex under external pressure.
