Freight prices the risk. Products pay the bill.

The August data revealed a market split in two. The IEA lowered its forecast for global oil demand, yet at the same time pointed to a deep third-quarter deficit, falling stocks and record margins on middle distillates. Meanwhile transits through Hormuz remained drastically curtailed and tanker rates set new records.

For Europe this meant three separate premiums: for the missing refined products, for the security of the route and for the time needed to find a replacement cargo. The United States partly filled the gap, but the maintenance work at Freeport LNG and the limited pace of export growth showed that the Atlantic is not an infinite buffer.

In aviation, traffic growth was marginal while fuel risk remained high. The physical jet fuel market was relatively well supplied, but the forward curve was still paying for uncertainty. In SAF, regulation continues to create demand, yet the most important currency remains a transparent cost benchmark and a credible offtake contract.

Global Energy Monthly is published monthly. The construction stays the same: a fixed data cut-off date, a full register of sources and an assessment of stress by market. The online edition adds theses to be settled in the next issue and a calendar of signals – sections of the Danske Gas Intelligence editorial team, settled regardless of the outcome.

The energy market in August was above all a market of throughput and available tonnage. The spot price described the value of the molecule at the reference point; the cost of delivery was decided by whether a vessel could sail, who would insure it and how long the alternative route would take.

S&P Global Energy reported that since the start of the war the number of vessel transits through Hormuz has fallen by more than 80%. In normal conditions the strait handles about one fifth of the world's seaborne flows of oil and LNG. Fewer vessels able and willing to make the voyage lowers fleet efficiency and lengthens turnaround.

Argus noted mixed traffic through the strait over the weekend of 22–23 August, and its analysis of the freight market pointed to the growing weight of war-risk premiums, vessel availability and alternative routes. That explains why the cost of products stayed high even when the crude price was responding to signals of weaker demand.

The IEA lowered its forecast for global oil demand in 2026 to a decline of 1.6 mn b/d, 510 kb/d deeper than a month earlier. The closure or restriction of Hormuz and high fuel costs suppressed consumption. The largest decline fell in the second quarter, and the third was expected to remain clearly negative.

This did not, however, mean a market in surplus. The IEA estimated the Q3 deficit at 1.8 mn b/d, more than twice its July assessment. Global supply in July was 101.5 mn b/d, and stocks fell by 69 mn bbl; on a year-on-year basis the IEA showed supply 6.3 mn b/d lower. The IEA’s August picture combined constrained supply, falling stocks and a balance in deficit.

North Sea Dated rose by 25.67 USD/b in July and closed the month at 96.80 USD/b; at the time of the report's publication it was trading at about 92 USD/b. Weaker demand and a deep deficit occurred at the same time – not a contradiction, but a description of a market in which supply returns more slowly than consumption is lost.

Seven OPEC+ states – Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria and Oman – decided on 2 August on an output adjustment of 188 kb/d from September. At the same time they stressed the obligation to compensate for earlier overproduction and the continuation of monthly reviews of the market situation.

The JMMC drew attention to the importance of the security of sea lanes and to the costly and lengthy rebuilding of damaged infrastructure. This is an important distinction: a formal production quota is not the same as a barrel available at the port of destination if the infrastructure or the route remains constrained.

Bloomberg's August monitoring of Asia described a change in buying patterns: Chinese refineries reached for Iraqi crude, India bought further ahead, and producers looked for delivery points avoiding the riskiest waters. These are signals of a reorganisation of flows, not of a complete disappearance of demand.

The rate on the LR2 Persian Gulf–Japan route reached 107.72 USD/t on 27 August and held that level a day later. S&P Global Energy pointed out that the limited ability to pass through Hormuz and the varying risk tolerance of shipowners worsened fleet utilisation and raised the call on tonnage.

Transmission into the product was visible in the same week: ULSD CIF Mediterranean was assessed on 26 August at 1295.75 USD/t against 762.75 USD/t before the outbreak of the war and a five-year average of 853 USD/t. In South-East Asia, August distillate imports were about 20% lower than before the war.

The EIA forecast average US LNG exports in Q3 at 16.5 Bcf/d (about 467 mn m³/d), 0.2 Bcf/d less than in its July forecast. The work at Freeport LNG, begun on 10 July and scheduled to the end of August, covered 2.0 Bcf/d (about 57 mn m³/d) of nominal export capacity.

High spreads to Europe and Asia gave an incentive to export, but the EIA stressed the slow pace at which additional capacity is being added. At the same time S&P Global Energy judged that a full repair of Qatar's LNG infrastructure will take years. For buyers this means that competition for flexible Atlantic cargoes will remain structural.

GIE AGSI+ data showed about 59.4% fill on 11 August, 62% around 20 August and 65.4% at the end of the month. The pace of injection was positive, but the distance to the 90% target for 1 November remained large. Europe was therefore more dependent on autumn LNG imports and on the weather than in seasons with higher stocks.

New EU gas market rules have applied since 5 August. They are intended to support market integration, security of supply and the gradual replacement of fossil gas with renewable and low-carbon gases. For trading this means that short-term stocks and structural change matter in parallel.

Global refinery runs rose in July to 80.9 mn b/d, but remained almost 5 mn b/d below the level of a year earlier. The IEA lowered its forecast of Q3 runs by a further 370 kb/d owing to disrupted product exports from the Middle East and attacks on Russian refineries.

Seaborne product trade fell by 3.8 mn b/d year on year. Diesel exports from Russia, the Middle East and Asia were lower by 1.3 mn b/d, and jet fuel by about 670 kb/d. The rise in US exports of 700 kb/d eased the gap but did not offset it.

S&P Global Energy described a paradox: the physical jet fuel-to-diesel regrade stood at minus 11.89 USD/b on 12 August, which encouraged refineries to maximise diesel output. The European jet fuel market was supplied by imports from the US and Nigeria, yet the September and October jet fuel curve remained above diesel because of the war premium.

IATA reported on 31 August that global passenger traffic (RPK) in July rose by only 0.2% year on year and capacity (ASK) by 0.3%; the load factor was 85.2%. The Middle East remained the weakest region. IATA explicitly named high fuel costs, economic uncertainty and geopolitical tensions as continuing burdens.

On 10 August the updated Platts methodology for the cost of SAF production in North-West Europe and on the US West Coast took effect. For the HEFA pathway it takes into account, among other things, capital costs, yields, fixed costs, hydrogen, feedstock and utilities. This is an important step: the market needs a comparable cost of production, not only the price of a single transaction.

On 7 August SAFCo in Singapore announced the completion of the first voluntary joint SAF procurement trial. On 20 August a demonstration plant for a new synthetic aviation fuel pathway was inaugurated in Switzerland. Both events are small against the scale of the mandate, but they show the shift from declarations to infrastructure and a purchasing mechanism.

The scale of the mandate is known: from 2% in 2025, through 6% in 2030 and 20% in 2035, to 70% in 2050. Such a path will not close without long-term feedstock supply and production capacity, and therefore without contracts that a bank will regard as credible.

The qualitative map combines supply, logistics and demand without pretending to a single synthetic index. Five regions, five transmission channels: from supply and freight in the Gulf, through gas and distillates in Europe, to replacement cargoes from the Atlantic basin.

Bloomberg's August monitoring of Asia showed the cost of this reorganisation: expensive LNG purchases by India, the shifting of Chinese crude purchases and rising tanker earnings. We treat this material as qualitative confirmation of the direction, not as a source of a full price series.

The statements below follow from the assessments contained in this issue. Where the August data provide a numerical threshold, we state it explicitly; where they do not, we settle the direction.

Only material published in August 2026 entered the synthesis. The exceptions are two standing references: the GIE AGSI+ platform as the source of daily data, and the European Commission website for the ReFuelEU Aviation thresholds in force. The titles in the table are live links.