South Korea Inflation Rises to 2.3% in December, Matching Market Expectations 
South Korea Exports Hit Record High as Global Trade Momentum Builds 
Forex Markets Hold Steady as Traders Await Fed Minutes Amid Thin Year-End Volumes 
Singapore GDP Growth Surges in 2025 but Outlook Remains Cautious Amid Global Trade Risks 
U.S. Stocks Slip as Gold Rebounds Ahead of Year-End, Markets Eye 2026 Outlook 
South Korean Won Slides Despite Government Efforts to Stabilize Currency Markets 
U.S. Dollar Starts 2026 Weak as Yen, Euro and Sterling Hold Firm Amid Rate Cut Expectations 
China Manufacturing PMI Rebounds in December, Offering Boost to Economic Growth Outlook 
Wall Street Ends Mixed as Tech and Financial Stocks Weigh on Markets Amid Thin Holiday Trading 
Asia Manufacturing PMI Rebounds as Exports and Tech Demand Drive Growth into 2026 
South Korea Factory Output Misses Forecasts in November Amid Ongoing Economic Uncertainty 
U.S. Dollar Slides Toward Biggest Annual Loss Since 2017 as 2026 Risks Loom 
Oil Prices Slip Slightly as Markets Weigh Geopolitical Risks and Supply Glut Concerns 
Asian Markets Slip as Precious Metals Cool, Geopolitical Tensions Weigh on Sentiment 
Japanese Business Leaders Urge Government Action as Weak Yen Strains Economy 
U.S. Dollar Steadies Ahead of Fed Minutes as Markets Eye Policy Divisions 
Asian Markets End Year on AI Optimism as Precious Metals and Currencies Shine 
European oil and gas equities are entering 2026 on a more cautious footing as J.P. Morgan’s latest EU Oils Outlook highlights tightening valuations and growing concerns over a projected global oil oversupply. Despite Brent crude slipping 7% in the second half of 2025, EU oil stocks managed to outperform the broader European market by 6%, creating what the brokerage calls a “significant positive decoupling.”
Analysts now view sector valuations as “full,” noting an estimated 7.8% free cash flow yield for 2026 based on $62/bbl Brent—considered rich compared with long-term norms. Consensus forward P/E ratios around 10.3x suggest the sector trades in line with its 10-year average discount as forward curves point to Brent stabilizing near $60/bbl. J.P. Morgan’s commodities research, however, expects Brent to fall below that level through 2026 and 2027 as oversupply builds, putting further pressure on earnings expectations.
Only Shell and Repsol retain “overweight” ratings. Shell, the bank’s top pick, is supported by strong free-cash-flow generation, a projected 10.1% 2026 cash yield, and resilient downstream exposure that hedges against lower oil prices. Repsol benefits from high diesel leverage, a 6.1x 2026 P/E, and a robust 6.5% dividend yield as refining continues to deliver sizable operating profits.
Several majors face downgrades: TotalEnergies is cut to “neutral” due to limited valuation upside and slower free-cash-flow growth from its Integrated Power segment, while Eni moves to “underweight” as rising gearing and sensitivity to upstream prices weigh on the outlook. BP, Galp, and Neste remain “neutral,” whereas Equinor and OMV are rated “underweight.”
Across the sector, average dividend yield stands at 5.7%, while overall upside potential remains below 5%. With Europe structurally short on diesel and still relying on imports for about one-fifth of demand, elevated diesel margins continue to provide a crucial hedge for downstream-weighted companies.
