A dual energy shock shook global markets as US diesel prices neared all-time highs while Russia’s August oil revenues plummeted to their lowest level since February. The escalating crisis has driven European and UK borrowing costs to multi-year peaks as geopolitical threats loom over global supply chains.
Global market
The average US diesel price surged to $5.7832 per gallon, only three cents shy of the historic June 2022 peak of $5.8159. US gasoline also spiked to $4.10 per gallon, a record high for this season. This fuel spike, coupled with escalating geopolitical tensions, triggered a global bond sell-off, pushing 10-year UK gilt yields to 5.27%—a level not seen since the 2008 financial crisis. In South America, Venezuela’s opposition leader Maria Corina Machado backed a long-term US oil partnership but questioned the legitimacy of acting President Delcy Rodriguez’s sweeping deal covering 65 billion barrels of reserves. Meanwhile, Brazil’s Congress passed bill PL 2.780/2024, establishing a strategic minerals policy backed by a 2 billion reais ($393 million) guarantee fund.
Russia & CIS
Russia’s net oil revenues sank by 22% year-over-year in August to 326.2 billion rubles ($3.76 billion), marking the lowest monthly inflow since February. According to tax authorities, the decline was driven by a sharp drop in Russia’s benchmark Urals price, which fell to $59 per barrel compared to its spring average of nearly $95. Total Russian oil and gas revenues also fell by 16% to 424 billion rubles. Adding to Moscow’s logistical hurdles, Norway seized the Russian research vessel Professor Molchanov at Svalbard at the request of Ukraine’s Naftogaz to enforce a $4.22 billion arbitration award for annexed Crimean assets. On a positive note, Kazakhstan’s KazTransOil completed its first transit oil delivery to Kyrgyzstan.
Armenia
Armenia’s natural gas consumption increased in the first half of 2026, driven by rising household demand, though consumption at compressed natural gas stations saw a decline. The stability of retail fuel tariffs in the country continues to rely on EAEU agreements securing duty-free Russian fuel at fixed rates, insulating the domestic market from volatile international market price assessments. However, regional security risks escalated as Israel’s Defense Minister threatened strikes on Iran’s energy infrastructure, a key neighbor and energy partner of Yerevan. Additionally, the Norwegian seizure of the Russian vessel Professor Molchanov to enforce the $4.22 billion award was widely covered by Armenian media.