Tight Fuel Supplies & Global Energy Shifts

by Jay Young | Investing, Oil & Gas, Tax Savings, Taxes, The Upside

Newsletter No. 188

Good afternoon subscriber,

There’s a lot happening in the energy business right now, and this week’s stories show just how connected the global oil and gas market really is.

EnCap is holding on to $3.5 billion in Permian Basin mineral assets, and dealmaking continues across Canada. At the same time, Morgan Stanley is warning that fuel supplies could remain tight well into 2027. India is looking for new sources of crude oil, and a recent pipeline disruption between Texas and Mexico shows just how important reliable natural gas supplies are.

This week is also a special one for us at King Operating. On Sunday, October 18, we celebrated 30 years in business. We've seen oil prices rise and fall, markets change, and technology reshape how we operate. Through it all, we've kept our focus on finding opportunities and developing oil and gas assets. Thirty years is a milestone we're proud of, and we're looking forward to what's next.

Keep reading this week’s The Upside for a closer look at the stories shaping the energy market.

 

This Week's Headlines

Oil and Gas News

  • Fuel Supply Could Stay Tight Through 2027

  • India Looks Beyond the Middle East for Oil

  • Texas Natural Gas Keeps Mexico Running

What's Happening at King

Move to Watch

  • EnCap Makes a $3.5 Billion Bet on the Permian
   

Oil and Gas News

Fuel Supply Could Stay Tight Through 2027
Morgan Stanley expects global fuel supplies to remain tight through mid-2027 as refineries prepare for major maintenance shutdowns. Many refiners have delayed maintenance to keep fuel moving, but that work can only be pushed back so long.

An estimated 3.4 million barrels per day of refining capacity could go offline for maintenance in the second quarter of 2027, putting more pressure on diesel and fuel supplies. The International Energy Agency also expects diesel inventories to remain tight well into next year. With demand still strong and refineries already running hard, fuel prices could remain under pressure.

India Looks Beyond the Middle East for Oil
India’s largest state-owned refiner, Indian Oil Corporation, plans to slightly reduce its Middle East oil purchases as supply disruptions continue to create uncertainty. India is turning to countries like Brazil, Venezuela, and Ecuador to help fill the gap.

The shift comes at a cost. India’s crude oil import bill hit $15.4 billion in September, up 46% from a year ago. It’s another reminder that when oil supply gets disrupted, countries have to find new sources, and that often means paying more.

Texas Natural Gas Keeps Mexico Running
Kinder Morgan has restored natural gas shipments from Texas to Mexico after pipeline issues forced a temporary shutdown earlier this month.

The disruption raised concerns about Mexico's dependence on U.S. natural gas. About 75% of Mexico's natural gas comes from Texas, and the country reportedly has only three days of gas reserves.

It's a reminder of just how important Texas natural gas is, not just for the U.S., but for keeping Mexico's power grid running.

Enjoying this newsletter?

Subscribe to receive the latest oil and gas news, market updates, and experienced industry insights directly in your inbox.
    Get Oil & Gas Insights

    Reach Out

    To speak directly with one of our team members about King and our investment offerings, schedule a Zoom meeting with one of our SVPs.
    Book a Meeting

    More About King

    Are you an accredited investor? If you are, fill out your information to learn more about King.
    Learn More

    Happening at King

    Billions Flow Into Oil & Gas: The M&A Deals Reshaping the Energy Industry
    Billions of dollars are moving through the oil and gas industry as major energy companies pursue acquisitions, expand infrastructure, and position themselves for future growth. What's driving these deals, and what do they reveal about the value of energy assets?

    In this episode of The Jay Young Show, my co-host Rachel Griffith and I break down some of the biggest mergers and acquisitions making headlines in 2026, including major transactions involving Energy Transfer, ONEOK, Magnolia Oil & Gas, Matador Resources, and Diversified Energy.

    Upcoming Webinar with EPG's Dan Steffens
    On Election Day, the stakes are high for U.S. energy policy, and oil markets are facing significant uncertainty. Could oil prices reach $125 per barrel by Christmas? What could the midterm elections mean for the future of the oil and gas industry?

    Join Dan Steffens, President of Energy Prospectus Group (EPG), and Rachel Griffith, SVP at King Operating Corporation, on Tuesday, November 3, for a timely discussion on the forces shaping today's energy markets.

    Date: Tuesday, Nov. 3, 2026

    Time: 1 p.m. CT

    Register Here

     

    Sold a Business? Facing a Big Tax Bill?

    Don’t wait until year-end to find out what you may owe. Use our Tax Calculator to see how a qualifying oil and gas investment could potentially impact your taxable income and help you better understand your options.
    Calculate Your Tax Savings

    Get the daily oil and gas brief on

    Substack.

    Subscribe to The Upside for a quick look at what’s happening across the oil and gas industry, including market moves, energy news, and the stories that matter most. Stay informed. Stay ahead.
    Subscribe

    Move to Watch

    EnCap Makes a $3.5 Billion Bet on the Permian
    EnCap Investments has closed a record $3.5 billion deal to hold on to its Permian Basin mineral interests. The portfolio covers 134,000 net royalty acres and generates about 37,000 barrels of oil equivalent per day, with major operators including ExxonMobil, Diamondback Energy, and ConocoPhillips.

    The deal allows EnCap to keep its stake in producing assets while giving existing investors a chance to cash out. It's another sign of how much value major investors continue to see in the Permian Basin and the long-term cash flow these assets can generate.

    Thank you for your continued support, and if you have any questions for myself or any member of the King team, please don't hesitate to reach out to us.
     

    All the best,
    Jay

    15301 Dallas Parkway, Suite 900
    Addison, TX 75001

    (214) 420-3000