Global Oil & Gas Trade: Current Situation and Five-Year Outlook

A supply shock with two clocks

The market picture entering the final quarter of 2026 has been shaped by two forces moving in opposite directions. In the near term, disruption to Gulf production and shipping has tightened physical availability and pushed up the cost of securing prompt cargoes. Over a longer horizon, a large wave of new LNG capacity points towards a more competitive market for gas buyers.

The accompanying report records Brent moving from a range of roughly $63–72 per barrel in January and February to sharp spikes in March and April, a relief decline in June, and a renewed rally towards $109–111 in October. It estimates that Middle Eastern crude production shut in during September remained around 4.8 million barrels per day, after a much higher peak earlier in the year. These are the report’s observations and estimates as of 27 October 2026.

Price is only one part of the story. The market is also pricing time, vessel availability, route security, insurance and the ability to deliver.

Shipping is part of the energy price

In a disrupted market, a cargo is not economically complete when it leaves a production site. It must still reach its buyer. Longer voyages, convoy requirements, ship-to-ship transfers, rerouting and elevated war-risk premiums all change the delivered cost. Record tanker earnings can therefore widen regional price differences even when benchmark prices move in another direction.

For shipowners and charterers, freight and insurance should be treated as central inputs to voyage economics, not as secondary adjustments. The availability of vessels is effectively reduced when ships spend more time on each voyage, wait for safer passage or reposition away from a trade. In tonne-mile terms, the same cargo volume can absorb more fleet capacity simply because the route has become longer.

That is also why energy and shipping cannot be analysed separately. A lower benchmark price does not automatically mean a lower delivered cost. The relevant calculation includes the origin, destination, vessel, voyage duration, insurance, port constraints and the commercial terms attached to the cargo.

LNG: immediate tightness, medium-term abundance

Natural gas and LNG face the same vulnerability to maritime chokepoints, but their medium-term outlook is different from oil. The disruption has reduced flexibility in the short term, particularly where buyers rely on a narrow set of suppliers or routes. At the same time, the industry is commissioning a substantial volume of new liquefaction capacity.

The report estimates global LNG supply at approximately 475 million tonnes in 2026, rising to around 505 million tonnes in 2027 and 525 million tonnes in 2028. Its central tension is clear: near-term security concerns sit alongside the prospect of a structurally looser market as new US, Qatari and other projects enter service.

For buyers, this strengthens the case for portfolio flexibility rather than simply locking in volume. For sellers, low-cost resources and reliable delivery may remain more durable advantages than capacity alone. Projects with high break-even costs could face tougher financing and final-investment decisions if the anticipated supply wave arrives while demand growth is weaker than expected.

Oil outlook through 2031

The report uses scenarios rather than a single price prediction. The base case assumes that Gulf flows largely recover, inventories begin to rebuild and non-OPEC supply continues to grow. A more bullish path assumes renewed disruption, while the bearish scenario combines a faster recovery with softer demand and a larger market surplus.

These figures are annual-average scenario values from the accompanying report, not guarantees or trading recommendations. The range is wide because security conditions, infrastructure recovery, OPEC+ decisions, demand elasticity and investment outside the Gulf can each change the balance materially.

What market participants should watch

Shipowners and charterers

Build route risk, waiting time and war-risk premiums into voyage economics. Keep alternative employment and loading options under review, while distinguishing between a temporary freight spike and a sustained change in vessel utilisation.

Traders and refiners

Focus on delivered economics and regional differentials, not benchmark prices in isolation. Flexibility in crude slates, product sourcing and logistics can become a meaningful competitive advantage during a disruption.

LNG buyers and sellers

Buyers should preserve destination and volume flexibility where the contract allows it. Sellers should assess how new capacity affects the value of reliability, cost position and long-term customer relationships.

Governments and investors

Resilience has a cost, but concentration has a cost too. Storage, bypass pipelines, alternative terminals and diversified import portfolios may look less efficient in normal markets; their value rises sharply when a critical route is unavailable.

Important note: This article is an editorial summary of the accompanying market report, prepared for informational purposes only. Price scenarios are estimates and may change materially. Nothing here is investment advice or a recommendation to buy or sell a commodity, security or derivative.