Oil & Gas News and Energy, Tuesday, December 2, 2025 — Ukraine Negotiations, Markets, and COP30 Outcomes

Current News from the Oil, Gas, and Energy Sector as of December 2, 2025: Market Situation, Renewable Energy Updates, Geopolitics, Investments, and Key Events in the Global Energy Sector.

Oil Market

• OPEC+ decided during its November meeting to maintain the current production levels for Q4 2025 and Q1 2026 without changes. This decision indicates the continuation of the existing reduction scheme (approximately 3.2 million barrels per day) amidst projected demand slowdown.
• The U.S. is producing a record volume of oil (~13.8 million b/d), while commercial oil inventories are rising. Increased domestic inventories in the U.S. and other countries are limiting further increases in global fuel prices.
• Incident in Novorossiysk: Ukrainian drones damaged one of the Caspian Pipeline Consortium (CPC) berths, reducing oil shipments to the port. This incident temporarily lowered CPC exports (~1% of global supply), causing brief price fluctuations.
• Geopolitics: Ongoing negotiations regarding Ukraine remain a critical factor. The prospect of a peaceful resolution may potentially ease sanctions against Russia and increase oil and gas supplies. Concurrently, the risk of new restrictions and asset restructuring continues to create uncertainty within the sector.

Gas Market

• European reserves: By the start of the 2025/26 heating season, EU gas storage facilities are filled to about 75-80% of capacity, significantly above average levels. This reduces the risk of gas shortages and keeps prices at low levels (TTF ~€30/MWh).
• LNG imports: Europe is actively increasing its liquefied natural gas (LNG) imports. The commissioning of new terminals in the U.S. and Australia, along with weakened demand from Asia, has provided additional LNG volumes for the EU. In 2025, LNG flows into Europe increased significantly, helping to diversify supply sources.
• Russian supplies: Russia is shifting its focus towards Asian markets. Exports through the Power of Siberia pipeline to China are growing, with the Power of Siberia-2 project expected in 2026. Gazprom is negotiating contract extensions with Turkey while maintaining exports via the Turkish Stream. Traditional supply routes to Europe are currently operating at reduced capacity.
• Domestic demand: In Germany, gas consumption has increased significantly due to a decrease in wind and hydro energy production. This slows down the filling of storage facilities and creates localized price pressure in the region, although the overall European system is receiving the necessary imports.

Electricity and Renewable Energy

• Record growth in renewables: Renewable energy sources are adding capacity at unprecedented rates. Solar and wind generation in many countries have surpassed the growth rate of electricity demand, marking a stabilization of global CO₂ emissions for the first time. China and the U.S. remain leaders in the expansion of clean energy, while Europe gradually adjusts its support programs.
• Investment in infrastructure: Following COP30, global energy companies and governments announced plans for significant funding for grid modernization and storage systems. Major energy giants alone promised to invest about $148 billion annually in new transmission lines and energy storage systems, enabling better integration of variable energy sources.
• EU policy: Brussels continues its course towards energy independence. New measures under REPowerEU include a phased phase-out of Russian gas and oil imports by 2027, extended requirements for gas storage filling until the end of 2027, and increased funding for energy efficiency and clean energy projects. Discussions are underway for the accelerated construction of new renewable energy projects and grids.
• Nuclear program: Despite the focus on green energy, countries are not abandoning the nuclear path. A recently published EU report indicates that investments in nuclear power plants (extending the lifespan and constructing new ones) will require around €241 billion by 2050. Concurrently, plans for small modular reactors (SMRs) and hydrogen technologies are being developed as "bridges" to a decarbonized economy.

Coal Sector

• Long-term contracts in Asia: Many Asia-Pacific countries still rely heavily on coal consumption. Agreements made years ago guarantee the operation of coal-fired power plants for decades, regardless of wind or solar availability. Experts estimate that coal continues to provide a significant share of generation in Southeast Asia, although its global share is gradually declining.
• Global trends: Nevertheless, several major economies have announced a phased exit from coal. The Chinese market is showing early signs of emissions reductions due to record renewables input: in 2025, its coal emissions fell for the first time. South Korea, India, and several European countries have announced new targets for reducing the share of coal generation and increasing the role of clean energy.
• Climate commitments: The final document from COP30 made no direct mention of "coal" (under pressure from exporting countries), but individual nations announced their own measures. South Korea, for instance, will cease the construction of new coal-fired power plants and gradually close existing ones. Additionally, an international methane reduction fund was launched at the summit (with a contribution of £25 million), which indirectly signals a transition to cleaner energy sources.

Refined Products and Refineries

• Demand evolution: The demand for refined products is unevenly changing. Diesel fuel and jet fuel are recovering more quickly due to increased freight volumes and the resumption of air travel, while gasoline demand is recovering more slowly. This shift in demand is prompting refineries to adjust their production (increasing the share of diesel and jet fuel).
• Refining: Refineries in Asia and the Middle East are operating at nearly full capacity due to the high supply of crude. This boosts confidence in refined products exports, but margins are pressured due to an oversupply of crude. In Europe, some refineries have switched to processing crude varieties that are not under sanctions, but overall plant utilization remains high.
• Sanctions: Restrictions on Russian refined products continue to influence the balance. The EU and the U.S. have imposed bans on diesel and jet fuel imports from Russia, forcing some refineries to seek alternative supplies. These measures keep prices stable in the face of crude oversupply while simultaneously encouraging companies to accelerate the development of alternative fuels and comprehensive recycling of by-products.

Companies and Investments

• Exploration and projects: Europe is gradually relaxing drilling restrictions. In Greece, a license for an offshore gas field was granted to Exxon/Energean for the first time in 40 years in November, while in Italy and the UK, companies like Shell and Chevron have received or are awaiting approvals to expand existing fields. These steps reflect a new approach to self-resource seeking.
• M&A activity: The segment is seeing high levels of activity. For instance, Targa Resources acquired gas transportation assets in the Permian Basin for $1.25 billion, strengthening its pipeline network in the U.S. Oil traders (such as Gunvor and Vitol) are considering participation in U.S. shale projects, aiming to diversify their portfolios and secure long-term fuel supplies.
• LNG projects: Investors are reassessing long-term commitments. The British government has declined to finance $1.15 billion for an LNG project in Mozambique due to security risks and shifts in the global agenda. TotalEnergies is preparing for a resumption of work on this project, but the timeline and financing volumes remain subject to review.

Geopolitics and Regulation

• Sanctions and agreements: Negotiations concerning Ukraine continue to set the market tone. While there is currently no specific agreement, discussions have included plans for tightening sanctions against Russia after 2025. The European Union has already extended mandatory gas storage filling norms until the end of 2027 and announced new incentives for "green" projects in an effort to ensure energy independence.
• International cooperation: G20 countries and COP30 participants have agreed to increase funding for climate programs. Estimated needs for assistance to developing countries in order to achieve climate goals by 2030 reach $2.4 trillion annually. China and India have confirmed their readiness to play a key role in expanding renewable energy, while developed countries have promised additional investments in clean technologies.
• Regional initiatives: New organizations are forming at the union level. The EU has created an Energy and Raw Materials Platform for joint procurement of critical resources (hydrogen, natural gas, etc.). In Asia, cooperation is growing to develop regional gas markets and "green" funds. Many countries are developing national decarbonization roadmaps, introducing tax and subsidy incentives for the transition to clean energy.
• Technological standards: Concurrently, emissions regulations are being improved. The U.S. is tightening methane emission standards at oil and gas fields, while the EU is promoting clean energy support mechanisms through carbon pricing and quotas. These measures aim to accelerate the transition to a green agenda and influence investment strategies for companies worldwide.