Detailed Overview of the Fuel and Energy Sector News as of August 31, 2025: New Export Restrictions on Fuel and Government Measures, Pressure on Global Oil Prices Amid Supply Glut, Stability in the Gas Market Due to High Reserves, Energy Cooperation in Eurasia and Development of Renewable Energy Sources.
The Sunday of August 31 brings fresh developments in the fuel and energy complex (FEC). The Russian government has extended restrictions on gasoline exports in response to a record rise in prices and localized fuel shortages. Meanwhile, global oil prices remain under pressure, with excess supply and slowing demand keeping quotes near multi-month lows. The European gas market demonstrates stability thanks to record-high storage levels ahead of winter, even as geopolitical tensions continue with ongoing sanctions. In the meantime, Eurasian countries are enhancing energy cooperation, redirecting resource flows and jointly addressing infrastructural challenges. Beyond traditional hydrocarbons, increasing attention is being focused on the development of renewable energy sources and innovations to ensure long-term sustainability in the industry.
Global Oil Market: Supply Glut and OPEC+ Caution
By the end of August, the global oil market remains in a “bearish” state. The price of the benchmark Brent crude remains below $70 per barrel, close to the lows seen in recent years. The primary factor putting pressure on prices is the increase in supply amid subdued demand. OPEC+ countries continue to ramp up production: by the decision of the alliance, the quotas are set to increase by approximately 0.55 million barrels per day starting September 1. Thus, since spring, the cumulative increase in production has approached 2 million barrels per day, effectively reversing previous cutbacks. At the same time, the pace of global demand growth is slowing: OPEC analysts expect an increase in demand of only ~1.3 million barrels per day in 2025 compared to 2.5 million in 2023. The International Energy Agency estimates growth to be less than 1 million barrels per day, taking into account economic slowdowns.
The geopolitical component also influences market sentiment. In light of sanctions against Russia, Washington has threatened secondary sanctions against buyers of Russian oil, which could theoretically provoke supply disruptions and price spikes. However, proactive measures by Saudi Arabia and its OPEC+ partners to increase exports mitigate these risks. As a result, oil prices remain relatively low and volatile. Many producers are forced to enhance efficiency and reduce costs to maintain profitability at prices approximately 15% lower than a year ago. Several experts warn that if current trends persist, the average price of Brent could decline to $50 per barrel by 2026. Nevertheless, uncertainty remains high: any unexpected agreements among major powers or, conversely, new conflicts could sharply alter the price trajectory.
Gas Industry: Stability in Europe and Reorientation Towards Asia
The global gas market presents a more balanced situation. In Europe, by the end of summer, underground gas storage facilities are over 90% full, significantly ahead of the schedule for the heating season. This buffer keeps wholesale gas prices at moderate levels, significantly below the peaks of 2022. The EU continues to increase liquefied natural gas (LNG) purchases from various sources to compensate for virtually ceased direct deliveries of Russian pipeline gas. However, full energy “decoupling” from Russia has proven to be challenging: individual EU countries remain indirectly dependent on Russian energy resources. For example, Ukraine, having refused direct imports of Russian gas, has become critically reliant on reverse supplies from the EU and electricity imports from its neighbors. Its own gas reserves ahead of winter are at their lowest in a decade, forcing Kyiv to urgently procure fuel through European intermediaries. This situation reveals vulnerabilities: Hungarian Prime Minister Viktor Orban even noted that if energy resource exports from his country were halted, the economy of neighboring Ukraine could be paralyzed within days (Budapest, however, does not plan such steps). In a broader context, this highlights the importance of diversification: Europe is accelerating the development of renewable energy sources and LNG infrastructure, but it will still require record gas imports this winter.
Concurrently, the eastern redirection of gas flows continues. Gazprom has increased gas exports to China by approximately 28% from January to August 2025 compared to the same period a year earlier. Deliveries via the Power of Siberia pipeline are at contractual maximums, confirming Russia's strategic course to strengthen its position in the Asian market. For Beijing, the increase in imports of Russian pipeline gas allows the country to reduce purchases of expensive LNG from the spot market and gradually decrease its dependence on coal generation for environmental objectives. Thus, the Asian-Russian energy partnership is deepening, compensating for the shrinking collaboration between Moscow and Europe.
Russian Fuel Market: Crisis and Stabilization Measures
In the internal segment of Russia's oil products, August saw a sharp fuel crisis. Wholesale prices for gasoline soared to unprecedented levels: at the St. Petersburg Exchange in mid-August, the ton of AI-92 exceeded 72,500 rubles, while AI-95 reached 82,000 rubles, setting historical records. Over the past year, exchange prices have risen by nearly 50%, instantly pushing up retail prices. By the end of August, gasoline had become approximately 6.4% more expensive on average across the country since the beginning of the year, which is one and a half times higher than the overall inflation rate (~4.2%). Market participants and consumers felt fuel shortages in a number of regions—from the Far East to the southern areas—where independent gas stations began to limit sales, and prices at the gas stations exceeded 65 rubles per liter.
The reasons for this situation are complex. First, a seasonal increase in demand (summer travel, harvest season) coincided with planned refinery maintenance: simultaneous cuts in gasoline supply amid peak consumption led to local shortages. Second, additional shocks were caused by unforeseen incidents: in July and August, several major oil depots and refineries temporarily halted operations due to accidents and drone attacks, which reduced fuel production. Third, the governmental price-supporting damper became less effective: budget payments to oil producers were cut, and companies partially compensated for lost income by raising exchange prices, particularly on high-octane grades not subject to regulation. Finally, logistical constraints exacerbated the problem in remote regions: a deficit of local storage facilities and rising delivery costs resulted in prices being significantly higher than the national average in the Far East and new regions.
The Russian government intervened urgently to quell the panic. Since August 21, a temporary ban on the export of automotive gasoline and diesel fuel for oil companies has been introduced, initially planned until August 31. Now, these restrictions have been officially extended: the largest producers are prohibited from exporting gasoline at least until September 30, while independent traders and oil depots face a ban until October 31, 2025. This measure aims to saturate the domestic market and prevent further price increases. At the same time, authorities are preparing adjustments to tax and subsidy policies: in the fall, the State Duma will consider amendments to the damping mechanism, raising the basic price thresholds for calculating subsidies to oil refiners. Preliminary data suggests that the permissible deviation of the exchange price of gasoline AI-92 from the base price is planned to increase from 10% to 15% (for diesel fuel—from 20% to 25%). In simple terms, oil companies will be able to receive budget compensations even at current high prices, which will reduce incentives to further hike fuel costs.
Expert Commentary: “Measures to support oil companies need to be complemented by actions that reduce production and distribution costs for fuel. For example, decreasing tariffs from Russian Railways for the transportation of petroleum products (currently significantly higher than for coal transport) would partially relieve pressures on prices. Additionally, eliminating the federal portion of the excise tax on gasoline and diesel (25% of the total excise tax) would free around 250 billion rubles annually for refiners,” noted Sergey Tereshkin in comments to RIA Novosti.
In addition to financial measures, operational work is being carried out “in the field.” Major companies, at the government’s request, are daily directing additional fuel volumes to problematic regions—tanker trucks and tank containers are rapidly delivering gasoline to Primorye, the Far East, and Crimea. Local authorities are advised to prevent panic among the population and to monitor the situation at gas stations. By early September, a gradual improvement is expected: repairs at key refineries are nearing completion, the holiday season is ending, and fuel demand is decreasing. Experts believe that by September, the domestic market will transition from deficit to surplus, allowing prices to stabilize and decrease from peak levels.
Russian Oil: Export Reorientation and Record Processing Rates
The Russian oil sector continues to adapt to the new conditions. Despite sanctions and embargoes, oil exports remain close to pre-crisis levels. By the end of the first half of 2025, the average daily export of crude oil stood at around 4.3 million barrels per day—slightly less than in 2024. The lost European buyers have nearly been fully replaced by Asian customers: China and India now collectively purchase about 80% of the Russian oil export volume (compared to less than 50% in 2022). This indicates a reorientation of flows and the formation of a new sustainable geography of sales, in which friendly countries from Asia and the Middle East play a major role.
However, the pricing environment remains challenging. Due to the overall cheapness of oil in the global market and a persistent ~$10 discount on Urals compared to Brent, revenues to the Russian budget from oil and gas have decreased for the second consecutive year. Analysts estimate that in 2025, hydrocarbon revenues may be a quarter lower than the previous year. Nevertheless, many industry participants believe that the bottom has already been reached. The depreciation of the ruble and the gradual market stabilization in the second half of the year have stabilized export revenues. As a result, oil and gas revenues are now maintained at the levels of July and are expected to remain roughly within those limits for the rest of the year. Partial recovery is anticipated in 2026: thanks to a possible reduction in the discount on Urals and an increase in physical export volumes, the federal budget may receive 15–20% more oil and gas revenues than in 2025.
Simultaneously, domestic refineries increased oil processing to record levels. In August, after the completion of planned repairs, oil product output grew at a faster pace. The increase in processing depth allowed surplus volumes of fuel oil to be directed to export: in the first three weeks of August, exports of fuel oil from Russia reached approximately 1.1 million barrels per day, which is 200,000 barrels more than in July and close to the maximums seen in recent years. The main buyers of Russian fuel oil have become China, India, and Saudi Arabia, which actively uses this product for electricity generation. Thus, Russian companies are compensating for restrictions on gasoline exports by increasing supplies of other types of fuel, retaining their presence in external markets and ensuring the load of their capacities.
In the medium term, the Russian oil industry intends to maintain production at a stable high level, relying on new projects in Eastern Siberia and the Far East. These initiatives should ensure that Russia retains its market share and foreign currency revenues, even if sanctions persist. Key success factors will include the development of infrastructure, the import substitution of equipment, and the expansion of settlements in national currencies, which will reduce dependence on sanction pressure and the global financial system.
Regional Trends: Cooperation in the Eurasian Space
Important changes in energy logistics are noted in the post-Soviet and Eurasian spaces. Russia's closest partners in the EAEU are adapting to the new conditions and strengthening their interaction with the Russian Federation. For example, Kazakhstan has staked its bet on Russian oil export routes this summer. In August, Kazakhstan's oil authorities temporarily redirected the entire volume of exported crude oil through Russia via the CPC pipeline to the port of Novorossiysk. Previously, a significant portion of supplies went through the alternative Azerbaijani route (Baku-Tbilisi-Ceyhan), but technical problems (contamination of an oil batch) forced a limitation of capacity along the southern route for several months. In this situation, Russian infrastructure once again proved its reliability: transit through the CPC allowed Astana to export oil without interruption while issues were resolved on the other route. Experts note that, economically, transportation through Russia is often more advantageous and faster, and exceptional circumstances have only underscored this fact.
In addition to oil, cooperation continues to deepen in other sectors of the energy industry. For example, in August, Russia and Azerbaijan discussed synchronizing their energy systems and mutual electricity supplies to cover peak loads and emergency situations. Trade in oil products with Central Asian countries is also on the rise: neighboring states, such as Kazakhstan and Tajikistan, are increasing imports of Russian gasoline and diesel to stabilize their markets. Thus, regional integration in the FEC is strengthening, helping all participants more effectively navigate challenges—from fuel shortages to infrastructural constraints—and create a more resilient energy system in Eurasia.
Energy and Renewable Sources: Focusing on Sustainable Development
Despite the turbulence in oil and gas markets, the long-term course towards energy transition remains intact. New records for generation from renewable energy sources (RES)—solar, wind, and hydro resources—are regularly being set globally. In several countries, the share of “green” electricity already exceeds 30%, and even traditional hydrocarbon production leaders are investing in solar and wind projects. In China, for the first six months of 2025, the combined output of wind and solar energy is estimated to have surpassed electricity production from coal plants on certain days for the first time, highlighting the rapid growth of RES.
In Russia, the development of renewable energy is proceeding more gradually but steadily. The total installed capacity of RES generation exceeded 6.6 GW (as of July 1, 2025), increasing by ~7% over the year. The government aims to accelerate the commissioning of new capacities: by 2030, the total capacity of solar and wind stations is planned to reach ~15 GW. Simultaneously, initiatives are being implemented to enhance the reliability of the energy system amid the growing share of intermittent generation. By the end of the year, the Ministry of Energy promises to launch pilot industrial energy storage systems in the south of the country to smooth peak loads and integrate RES. Projects for hydrogen combustion and the implementation of small modular nuclear reactors for remote regions are also advancing. All these measures are aimed at ensuring that the national FEC remains competitive and resilient amidst the global energy transition. Meanwhile, oil, gas, and coal continue to constitute the foundation of the energy balance, but the contribution of “green” technologies is steadily increasing, altering the industry's landscape.
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