China imported less oil in 2024 than in 2023, a major contributor to the emergence of oversupply. The IEA expects this oversupply to continue in 2025. This depresses the price, partly because the ‘marginal barrel’ to meet demand becomes cheaper. The narrative of oversupply in 2025 may be at risk if the Chinese government pulls the handbrake on stimuli. On the other side of the Pacific, we see US oil production hitting another record high. A number of factors seem to indicate that opportunities for growth are running out, despite Trump’s intentions.
The gas market in the last weeks of 2024 was dominated by the expiring transit contract of Russian gas through Ukraine, which pushed the TTF gas benchmark towards EUR 50/MWh. In this Market Update we look further ahead, where we see the LNG market changing from a seller’s to a buyer’s market from mid-2027 onwards. This is important for the procurement strategy of European players, where the focus may shift more to spot markets. At the same time, this also brings risks compared to long-term contracts.