We expect a Russia-Ukraine ceasefire this year, but not a full peace deal.

As part of that, some Russian gas supply to the EU would likely resume, via Ukraine to landlocked parts of the bloc. Negotiations on this are still ongoing. However, we do not expect pipeline gas flows to return to pre-war volumes for several reasons. First, the Nord Stream pipeline system is largely inoperable, and there is no political appetite in Germany to rebuild that. Additionally, Poland has completely replaced Russian gas imports with Norwegian supplies and is unlikely to revert to using the Yamal pipeline. That said, some gas will likely flow into Central Europe through Slovakia, which is leading negotiations on transit payments to Ukraine rather than directly to Russia. This could ease some pressure on gas prices, as a significant amount of gas currently has to be imported via LNG and then pumped through Germany to reach landlocked regions.

Will Trump’s plans for US oil production materialize?

It’s not going to be the "drill, baby, drill" scenario that he’s been talking about - adding 3 million b/d over two years, but we do see it gradually rising toward 14 million b/d by the end of this year. At current WTI prices, most US producers are still profitable and there has already been an uptick in investment in anticipation of Trump’s return. His broader policy goal is to lower oil and gas prices to counteract the inflationary effects of tariffs.

Outlook for tighter US sanctions?

If Trump’s negotiations with Russia don’t go as planned, he may impose tighter sanctions on Russian LNG and possibly on oil. There is already a list of ships that could be targeted for sanctions, although Russia has largely ignored previous shipping-related sanctions. A similar scenario applies to Iran, where sanctions could be imminent, probably taking 500, 000 b/d of oil exports off the market. There’s sufficient spare capacity to offset any lost Iranian oil, but the real risk is Iran’s potential retaliation. This goes beyond oil markets and ties into broader Middle East stability, which is one of the major geopolitical risks that we are watching this year.