Oil Market: Brent at $87 — Market in Awaiting of Deal on Hormuz
Oil prices are finishing the week mixed. Brent is trading around $87 per barrel after a 2.2% decline on Thursday, while WTI hovers around $81. Since the onset of the conflict between the U.S. and Israel with Iran at the end of February, the international benchmark has risen by about a quarter, with an annual increase exceeding 30%. Key factors influencing price dynamics include:
- Status of the Strait of Hormuz: The key maritime corridor, through which approximately one-fifth of global oil supplies flowed before the war, remains formally blocked. Iran and Oman are negotiating shipping routes, but no agreement has been reached; Tehran demands the lifting of the U.S. maritime blockade as a precondition for fully opening the strait.
- Actual Flows: Despite the deadlock in negotiations, oil continues to leave the Persian Gulf — according to U.S. estimates, as much as 9 million barrels per day transit through the strait, with some tankers operating with their transponders turned off, and U.S. naval capabilities to escort ships are expanding. Attacks on tankers and energy infrastructure keep the risk premium elevated.
- Supply Shortage: The IEA estimates the current quarter's oil shortfall on the global market at 1.8 million barrels per day — double the previous forecast; in July, supply remained 6.3 million b/d below last year's level.
The U.S. Energy Information Administration (EIA) does not expect Middle Eastern production to return to pre-war levels before early 2027 and forecasts an average Brent price of $87 per barrel in 2026.
Demand Under Pressure: IEA and OPEC Cut Forecasts
The flip side of the price shock is the destruction of demand. This week, the IEA downgraded its forecast for global oil consumption, warning that the prolonged conflict and high prices are increasingly pressing on economic activity. OPEC, in turn, has reduced its estimate of global demand growth in 2026 to 580,000 barrels per day — marking the fourth consecutive downward adjustment. An additional bearish signal came from the U.S.: commercial oil inventories rose by 17.4 million barrels over the week — a record weekly increase — amid significant drawdowns from the strategic reserve and a sharp uptick in imports. Several analysts believe that the peak shortfall in the market was passed in May-June; however, the trajectory of prices depends entirely on the course of the conflict and the situation in the Strait of Hormuz.
Gas Market: Europe Enters Winter with Record Low Stocks
The European gas market remains the most vulnerable link in the global energy sector. Prices at the TTF hub fluctuated between €56–62 per MWh over the week, surging more than 10% at the beginning of the week due to supply risk news. Key issues include:
- Low Stock Levels: Underground storage facilities in the EU are only about 55–58% full — the worst figure for mid-August in history since records began in 2009 and around 22 percentage points below the five-year average. Brussels has already lowered the mandatory filling target from 90% to 80% by November 1, but that too is under threat.
- LNG Shortage: Shipments of Qatari liquefied gas through the Strait of Hormuz are significantly delayed, while competition with Asia for available cargoes intensifies amid a hot summer.
- The Norwegian Factor: The prolongation of maintenance at the Ormen Lange field until February 2027 could withdraw more than 1 billion cubic meters of gas from the market during the heating season.
Banks and energy companies are raising their price targets: Commerzbank has raised its year-end forecast to €50 per MWh, while Uniper expects a range of €50–60 as long as the strait remains closed. The heat in Europe further escalates the demand for electricity for air conditioning, intensifying pressure on the gas balance.
Power Generation and Renewables: Sun and Wind Break Records
Against the backdrop of a hydrocarbon storm, renewable energy is demonstrating a structural breakthrough. According to the Ember research center, in 2026, the combined output of solar and wind stations in Europe may exceed gas generation for the longest period on record — monthly renewable energy output reached 80–110 TWh. The global picture is equally impressive: in 2025, the world installed a record 800 GW of renewable capacity (+16% year-on-year), of which more than 600 GW came from solar energy; China accounted for around 60% of the global increase. For the first time in history, solar energy has become the largest source of covering the increase in global energy consumption. In the U.S., wind and solar accounted for a record 17% of electricity generation, while in 2026, nearly all net new generating capacity will be provided by renewables and storage systems. High oil and gas prices only accelerate investments in clean generation, storage systems, and networks.
Coal: Beneficiary of the Energy Crisis
The coal market is strengthening due to the effect of fuel switching. Futures for Newcastle thermal coal have stabilized around $130 per ton — approximately 17% higher than last year’s level: expensive oil and gas are making coal generation more attractive in importing countries in Europe and Asia. China has released a five-year development plan for the coal industry that includes consolidation and digitization of mines while creating a reserve capacity of over 100 million tons per year. India is increasing its own output — in July, production rose by 7.5% year-on-year, reducing dependence on imports. In the short term, coal remains a buffer for Asian energy systems against gas shortages and high oil prices.
Russia: Export Ban on Fuel Extended to January 2027
The internal market for petroleum products in Russia continues to operate under strict control. The government has extended the total ban on the export of automotive gasoline until January 31, 2027, expanding restrictions to both producers and traders; the regime for the export of diesel fuel, marine fuel, and gas oils has also been tightened. Reasons and supporting measures include:
- Increased drone attacks on refineries in early August have led to a shutdown of several plants and a reduction in exchange sales of gasoline;
- Exchange prices have stabilized at high levels: the AI-92 index remains around 71,400 rubles per ton, while the AI-95 index is about 76,000 rubles per ton;
- Authorities have permitted the production of Euro-3 class fuels and simplified the import of petroleum products from friendly countries;
- A mechanism for direct contracts between factories and suppliers is being developed to circumvent the exchange and reduce speculative pressure.
Experts expect a gradual normalization of supply by the end of August and do not rule out a noticeable decline in wholesale prices not earlier than the fourth quarter — provided there are no new unexpected refinery shutdowns.
What This Means for Investors and Energy Sector Participants
The market has entered a phase of fragile equilibrium: the geopolitical premium in oil is colliding with growing signs of demand destruction, while the European gas market is pricing in the risk of a supply-short winter. For investors, key benchmarks for the coming weeks include:
- Negotiations on the Strait of Hormuz — any progress could collapse oil and gas prices by 10–15%, while a breakdown in dialogue could push Brent back to $90 and above.
- Gas Injection Rates in European UGS — falling behind schedule by the end of September could prompt early price formation for winter shortages in TTF.
- Supply and Demand Data from the U.S. and China — confirmation of consumption weakness will reinforce a corrective scenario in oil.
- Situation with Russian Refineries — the balance of the domestic fuel market and the timing of export restriction easing depend on the recovery of refining.
Daily Summary: Key Energy Sector Figures as of August 15, 2026
- Brent — around $87 per barrel; WTI — around $81;
- Global oil market deficit — 1.8 million b/d in the current quarter (IEA estimate);
- Oil demand growth forecast for 2026 — 580,000 b/d (OPEC, fourth consecutive downward revision);
- Gas TTF — €56–62 per MWh; EU UGS storage levels — around 55–58%;
- Newcastle coal — around $130 per ton (+17% year-on-year);
- Gasoline export ban from Russia — extended to January 31, 2027.
Saturday in the energy markets will be marked by anticipation: the fate of the Strait of Hormuz remains the main pricing factor for oil, gas, coal, and electricity worldwide. Investors and energy companies should prepare for heightened volatility — autumn 2026 promises to be a test of resilience for the entire global energy system.
