Energy Sector News September 17, 2025 - Sanctions, Oil, Gas, and Fuel Market Stabilization

Key Energy Sector News as of September 17, 2025: Sanction Risks, Oil Market Stability, Gas Sector Preparedness for Winter, Renewable Energy Records, High Coal Demand in Asia, and Extension of Fuel Price Stabilization Measures in Russia.

The current events in the fuel and energy sector (FES) as of September 17, 2025, are characterized by a combination of ongoing geopolitical tension and relative stability in commodity markets. Following summer contacts between Russia and the United States, there has been no significant breakthrough in relations, and sanction risks remain high. At the same time, the European Union unexpectedly postponed the presentation of a new (19th) sanctions package scheduled for today; discussions are still ongoing within the G7 framework and will take several more weeks. This reflects the complexity of the sanctions standoff, although certain communication channels between Moscow and the West continue to function. The global oil market maintains a fragile equilibrium: oversupply and slowing demand keep Brent prices around the upper $60 per barrel mark, indicating market resilience. The European gas market shows readiness for winter, with underground gas storage (UGS) facilities in the EU filled to over 90%, providing a buffer ahead of the heating season and keeping exchange prices at moderate levels. Concurrently, the global energy transition is gaining momentum, with many countries reporting new records in renewable energy generation, although reliance on traditional resources remains necessary for the reliability of energy systems. In Russia, following a recent spike in fuel prices, authorities continue to implement a set of emergency measures aimed at stabilizing the domestic oil products market. Below is a detailed overview of key news and trends in the oil, gas, energy, and commodity sectors as of the current date.

Oil Market: Oversupply Keeps Prices in Check Amid Geopolitical Risks

Global oil prices remain relatively stable as of mid-September, holding within a moderate range. The benchmark Brent crude trades around $66-$68 per barrel, while the American WTI is within $62-$64. Current quotes are approximately 10% lower than the levels recorded a year prior, reflecting a gradual normalization of the market after the peaks of the 2022-2023 energy crisis. Several factors are influencing price dynamics:

• Increase in OPEC+ Production. The oil alliance is gradually increasing supply. At the meeting on September 7, participating countries agreed to a further increase in total production quotas starting in October by about +137,000 barrels per day (following an increase of +548,000 b/d the previous month). Despite relatively low prices, OPEC+ aims to regain lost market shares, leading to an increase in global oil and oil product inventories.
• Weak Demand Growth. Global oil consumption is increasing at a much slower pace than in previous years. According to the International Energy Agency (IEA), the demand growth forecast for 2025 is less than 1 million barrels per day (compared to over +2.5 million in 2023). OPEC also predicts modest growth (~+1.2-1.3 million b/d). Factors include a slowing global economy (including reduced growth rates in China) and the effect of high prices in previous years stimulating energy conservation.
• Rising Non-OPEC Inventories. Commercial oil inventories in the U.S. unexpectedly increased in September, indicating surplus formation. Simultaneously, individual producers are ramping up exports: for example, Saudi Arabia sharply increased oil shipments to external markets after the end of high domestic consumption. Additionally, a reduction in oil product exports from Russia frees up additional crude oil volumes for the global market.
• Geopolitics and Finance. The ongoing sanctions conflict creates nervousness among market participants. The lack of progress in negotiations indicates that current restrictions will remain in place, with risks of new ones being introduced, as stated by Western leaders. Meanwhile, expectations for a near-term easing of U.S. Federal Reserve monetary policy are rising amid weak macro data – this weakens the dollar slightly and temporarily supports commodity prices. Risks of escalating conflicts in the Middle East also persist. Collectively, these factors keep oil prices within a narrow corridor – without any preconditions for either a sharp rally or a collapse.

Gas Market: High Inventory Levels in Europe Ensure Price Stability

On the gas market, attention is focused on Europe's readiness for winter. EU countries accelerated the injection of natural gas into storage throughout the summer, and by mid-September, UGS levels exceeded 90%. This high inventory level provides a buffer for the energy system ahead of the heating season. Consequently, gas exchange prices remain at relatively low levels: futures prices for gas at the Dutch TTF hub are around €30-35 per MWh, significantly lower than the peak figures recorded last winter. Nevertheless, experts warn of potential price volatility in the event of an abnormally cold winter or interruptions in LNG supplies. Overall, the European gas market currently appears significantly more resilient than a year ago, reducing the risks of energy shortages in the coming months.

International Politics: Sanction Standoff and Its Impact on Energy

The geopolitical situation surrounding the FES remains tense. On one hand, Moscow and Washington declare a willingness to maintain contact – certain working communication channels between the governments continue to operate, and new consultations are allowed. On the other hand, there is no actual easing of the sanctions regime; moreover, earlier intentions to intensify pressure have been expressed. An important signal is that the European Union has postponed the presentation of the next (19th) sanctions package against Russia, which was expected on September 17, to an indefinite date. According to media reports, this is due to the need to refine measures in coordination with G7 partners, including a proposal from the U.S. to develop a mechanism for seizing frozen Russian assets. While a temporary pause in the escalation of sanctions gives the market a slight respite, risks of new restrictions in the energy sector remain. Western countries continue to explore options for strengthening sanctions if there is no progress in resolving the conflict. Simultaneously, direct threats to infrastructure are increasing: in recent weeks, drone attacks on Russian FES facilities have surged, adding uncertainty and nervousness to the markets. In summary, the sanctions standoff and military risks remain key factors of uncertainty for global energy, restraining investment activity and requiring a restructuring of traditional energy resource supply chains.

Asia: Key Role of India and China in Energy Markets

Asian countries – primarily India and China – continue to play a crucial role in the global energy resources market, combining increased imports with the development of domestic production. **India** maintains a high level of purchases of Russian oil and oil products at discounted prices, despite Western pressure to reduce cooperation with Moscow. The Indian government clearly states that it will not sacrifice energy security: imports from Russia remain strategically important due to the growing needs of the economy. At the same time, New Delhi seeks to diversify sources: long-term contracts are being signed with the Middle East, LNG purchases are increasing, and domestic investments are being made to boost oil and gas production. In the short term, rising demand dictates the need for substantial imports, although India must also factor in sanction risks – major Indian corporations are implementing compliance measures to avoid secondary sanctions (for example, some ports restrict the entry of tankers associated with sanctioned companies).

China is also increasing purchases of traditional energy resources – oil, pipeline, and liquefied natural gas – while simultaneously boosting domestic production. Beijing has not joined the sanctions against Russia and remains the largest buyer of Russian oil and gas on favorable terms (Russian oil grades are sold to China at discounts to Brent). According to customs statistics, in 2024, China imported over 212 million tons of oil and around 246 billion cubic meters of gas, surpassing previous year’s figures. In 2025, imports continue to grow, although at a more moderate pace due to high baseline levels. At the same time, China’s national oil and gas companies are consistently setting historical records for hydrocarbon production, yet this is still not enough to meet domestic demand: the country depends on imports for approximately 70% of its oil and 40% of its gas. In pursuit of long-term energy security, Beijing and Moscow continue to develop cooperation: recently, key parameters for the future “Power of Siberia 2” gas pipeline to China were agreed upon, which is expected to significantly increase Russian gas exports to the Asian market. Thus, Asia remains the main destination for Russian energy resources, allowing Moscow to compensate for limited access to European markets.

Energy Transition: New Records in Green Energy and Balance with Conventional Generation

Global transition to clean energy in 2025 is entering a new phase. Many regions worldwide are recording record levels of capacity additions and electricity generation from renewable sources (RES). For instance, by the end of 2024, EU countries for the first time generated more electricity from solar and wind plants than from coal and gas plants – this trend continues into 2025 due to the rapid addition of new solar panels and wind farms. It is expected that in the current year the EU will set another record for the installation of RES capacity (estimated by the European Commission to be around 85-90 GW of new installations). In the U.S., the share of RES in electricity generation has already exceeded 30%, while **China** continues to add dozens of gigawatts of new solar and wind power plants every year, consistently updating its own records in green generation. According to the IEA, total investments in the global energy sector in 2025 will exceed $3 trillion, with more than half of this sum allocated to RES projects, grid infrastructure modernization, and energy storage systems.

Nonetheless, the rapid growth of variable renewable generation presents new challenges. During periods of low sunlight or wind, backup capacities from conventional power plants are still needed to cover peak demand and prevent outages. Many countries are engaged in large-scale projects to create energy storage systems (industrial battery farms, pumped-storage hydropower stations) and implement "smart" grids to enhance the flexibility of energy systems. Experts predict that by 2026-2027, renewable generation may surpass conventional coal generation globally for the first time. However, for the next few years, traditional resources – gas, coal, and nuclear energy – will continue to play a critically important role as a buffer supply source. Therefore, the current phase of the energy transition demands a careful balance: green energy is setting records and increasing its share, but traditional fossil fuel sources remain necessary for ensuring the stability of energy supply.

Coal: Asian Demand Supports High Market Levels

Despite climate concerns, the global coal market in 2025 continues to operate at historically high levels. Global coal consumption remains close to record figures, primarily driven by Asian countries. **China** remains the largest producer and consumer of coal, mining over 4 billion tons a year and burning these volumes at its power plants. During peak periods (e.g., during summer heat and spikes in air conditioning demand), even this volume can be insufficient: Beijing increases coal imports to avoid electricity shortages. **India** generates more than 70% of its electricity from coal-fired power plants, and absolute coal consumption is rising as the economy expands. Several other developing countries in Asia (Indonesia, Vietnam, Bangladesh, etc.) are also introducing new coal energy capacities to meet the growing demand for electricity.

The largest coal exporters – Indonesia, Australia, Russia, South Africa, and others – have ramped up production and shipments in recent years. Following price spikes in 2021-2022, global prices for thermal coal are currently maintained at relatively moderate levels, providing, on one hand, affordable fuel for energy, while on the other, remaining profitable for coal mining companies. Many countries announce plans to reduce coal usage in order to meet climate commitments, yet in the short term, this resource remains indispensable for reliable electricity supply for hundreds of millions of people, especially in Asia. As a result, the coal sector finds itself in a state of relative equilibrium: coal demand remains consistently high, while prices are moderate and predictable.

Russian Oil Products Market: Continuing Emergency Measures and Analyst Commentary

In the Russian fuel and energy sector, unprecedented measures were implemented in the second half of summer to curb the rising prices of oil products. In August, wholesale exchange prices for gasoline and diesel in the country reached historical highs amid a surge in demand, scheduled maintenance at several refineries, and the profitability of exports. To saturate the domestic fuel market, the government imposed temporary export restrictions on fuel: for major oil companies, the ban on exporting gasoline and diesel has been extended until September 30, while for traders and small suppliers it will last until October 31, 2025. Oil refineries are mandated to prioritize shipping their products to domestic consumers, increasing supplies to problem regions (additional fuel supplies have been directed to Primorye and Crimea, where shortages were previously observed).

Aside from these operational measures, authorities are considering long-term mechanisms to stabilize the oil product market. Among them is the recalibration of the damping mechanism: an expansion of the permissible range of price deviations from the basic indicator, for which producers receive compensation, is planned. In simpler terms, the government is prepared to raise the activation threshold of the "damping" mechanism (currently set at 10% for gasoline and 20% for diesel) so that refiners can receive payments even with higher domestic prices. This step is aimed at reducing the incentive for exports and supporting the economic viability of refineries, keeping more fuel in the domestic market.

As of early September, the measures taken yielded initial results: after peaks in mid-August, fuel wholesale prices have fallen by 7-8%. However, in the second decade of September, price pressure intensified again – exchange quotes for gasoline and diesel began to rise due to still high demand and temporary factors (repeated downtimes of refineries due to maintenance and drone attacks). Retail gasoline prices have increased by more than 7% since the beginning of the year, which is one and a half times higher than overall inflation (~4%). However, the government asserts that the situation is under control: filling stations are adequately supplied with fuel, and new shipments from refineries are arriving regularly. The Bank of Russia also expects that as the harvest season concludes and refineries resume operation post-maintenance, the growth of gasoline prices will slow. The resumption of oil product exports will only be permitted after full saturation of the domestic market and sustainable decline in exchange prices. Thus, the set of measures taken aims to gradually normalize the situation. Authorities are prepared to extend restrictions and engage additional resources to keep gasoline and diesel prices for end consumers within acceptable limits.

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