European gas prices surge amid fears US-Iran war will cause winter shortages
Summary
European natural gas prices have risen sharply due to increased conflict between the US and Iran, causing concerns about supply shortages this winter. The conflict has disrupted liquefied natural gas (LNG) exports from Qatar and led to fears of higher costs and the need for government action to ensure energy supplies in Europe.Key Facts
- Dutch natural gas prices briefly rose above €60 per megawatt hour, nearing highs seen at the start of the US-Iran conflict.
- The US expanded its air strikes and Iran retaliated with attacks on Bahrain and Kuwait.
- Europe's gas storage is currently less than 54% full, down from 64% at the same time last year.
- Since February 28, only 26 LNG shipments from the Gulf have moved east, compared to 90-100 monthly normally.
- Analysts expect Europe may have to pay €54 to €60 per MWh this autumn to restock gas supplies.
- The conflict threatens shipping in the Strait of Hormuz, a key route for about 20% of the world’s oil and gas.
- Oil prices also rose, with Brent crude briefly going above $90 per barrel due to the conflict.
- Experts note UK gas prices are tied to global markets and can be affected by distant conflicts.
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