Geopolitical tensions in the Middle East have escalated following attacks on two ADNOC tankers in the Strait of Hormuz, while Russian diesel exports collapsed to a multi-year low. In response, Washington has boosted advanced nuclear funding to secure domestic grids, while regional authorities in Russia have begun implementing strict fuel rationing.
Global market
The Strait of Hormuz faces critical security disruptions after two commercial vessels owned by the Abu Dhabi National Oil Company (ADNOC) were attacked in the vital shipping chokepoint. In response to the growing maritime friction, US Vice President JD Vance announced on Fox News that Washington’s operations against Tehran primarily aim to secure stable energy prices for the American public while preventing Iran from acquiring nuclear weapons.
Amt these fossil fuel supply risks, the US Department of Energy is accelerating next-generation nuclear technology, committing an additional USD 1 billion to X-energy for its Texas reactor project with Dow, as confirmed by X-energy CEO Clay Sell. This brings total federal support under the Advanced Reactor Demonstration Program to USD 2.15 billion as the US grid prepares for record annual power demand of 4,268 billion kWh driven by the artificial intelligence boom. Simultaneously, structural changes are transforming global power generation, with solar energy officially surpassing wind in global electricity generation for the first time in history.
Russia & CIS
Russia’s domestic refining crisis has severely impacted its fuel trade, causing diesel and gasoil exports to crash to a multi-year low of just 80,000 barrels per day (bpd) during the first week of August. This represents a precipitous drop from last year’s average of 1 million bpd, driven by extended export bans following relentless Ukrainian drone strikes on national refineries. To manage localized fuel deficits, Kaluga Governor Vladislav Shapsha announced on Telegram that the region will implement a strict “odd-even” gasoline rationing system at all retail stations starting August 15.
Despite refining constraints, crude exports to Asia remain robust, with China increasing its imports of Russian Urals and Kebco crude by 92% year-on-year during the first half of 2026 to reach 2.2 million bpd (or 56.3 million tons), according to data compiled by Argus. Meanwhile, infrastructure development continues in contested zones, with the Russian Ministry of Construction approving a new RUB 270 million high-pressure natural gas pipeline funded by Krasnodar in the Kherson region, while a severe blackout in Donetsk cut off electricity to more than 29,000 domestic consumers, as confirmed by Donetsk Mayor Alexey Kulemzin.
Armenia
Armenia’s strategic position as a South Caucasus transit hub faces significant geopolitical headwinds. A regional energy expert warned that the Azerbaijani-promoted TRIPP initiative is specifically designed to isolate Yerevan and strip Armenia of its unique strategic energy position in the region. The project seeks to reshape regional infrastructure networks and bypass traditional Armenian trade channels.
To withstand these hostile logistical alignments and protect its domestic consumers, Armenia continues to rely on the security of its EAEU integration. This framework ensures stable, long-term imports of Russian natural gas and petroleum products at fixed tariffs, completely insulating the Armenian market from extreme price spikes in global energy trade, where transactions are governed by volatile international market price assessments.
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