European Gas Prices Rise to 2-Week High
European natural gas prices climbed above €76/MWh on Monday, their highest level in two weeks, as ongoing security risks around the Strait of Hormuz continued to threaten LNG flows from the Persian Gulf. The waterway, which handled roughly a fifth of global oil and LNG trade before the war, has seen attacks on vessels in recent weeks, raising concerns over the security and reliability of shipping. While some Gulf LNG cargoes have transited the strait in recent weeks, volumes are still insufficient to fully relieve global supply tightness. In addition, QatarEnergy has recently extended force majeure on LNG deliveries to Italy’s Edison through December. Europe is racing to replenish reserves ahead of winter, with gas storage levels at around 72% of capacity, well below the five-year seasonal average of 87%. With inventories lagging seasonal norms, any prolonged disruptions or a colder-than-expected start to the heating season could further tighten the market and drive prices higher.
European natural gas prices climbed above €76/MWh on Monday, their highest level in two weeks, as ongoing security risks around the Strait of Hormuz continued to threaten LNG flows from the Persian Gulf. The waterway, which handled roughly a fifth of global oil and LNG trade before the war, has seen attacks on vessels in recent weeks, raising concerns over the security and reliability of shipping. While some Gulf LNG cargoes have transited the strait in recent weeks, volumes are still insufficient to fully relieve global supply tightness. In addition, QatarEnergy has recently extended force majeure on LNG deliveries to Italy’s Edison through December.
Europe is racing to replenish reserves ahead of winter, with gas storage levels at around 72% of capacity, well below the five-year seasonal average of 87%. With inventories lagging seasonal norms, any prolonged disruptions or a colder-than-expected start to the heating season could further tighten the market and drive prices higher.