Key facts
- European benchmark natural gas prices rose 2% on Monday.
- Dutch TTF futures were up 2.15% at $83.76 (73.62 euros) as of 7:15 a.m. Amsterdam time.
- Prices had fallen about 9% last week.
- The rally was triggered by concerns over LNG supply via the Strait of Hormuz.
- EU gas storage sites were just below 71% full as of September 27, below historical averages.
- Germany's gas storage sites were about 57% full.
European natural gas prices climbed 2% in early trading on Monday, with the benchmark Dutch Title Transfer Facility (TTF) futures reaching $83.76 (73.62 euros) per million British thermal units. This increase follows a roughly 9% decline last week and is attributed to renewed concerns over potential disruptions to liquefied natural gas (LNG) supply through the Strait of Hormuz amid ongoing U.S.-Iran tensions. The market is particularly sensitive as Europe approaches winter with historically low natural gas storage levels.
Growing worries that LNG shipments via the Strait of Hormuz will not return to normal soon, coupled with the fact that most of Qatar's LNG supply remains offline, are contributing to the price rally. While some Qatari and UAE cargoes have transited the Strait recently, the volumes are insufficient to significantly impact the global LNG balance.
Data from Gas Infrastructure Europe shows that as of September 27, EU gas storage sites were just below 71% full, a level lower than the average for this time of year over the past five years. Major economies like Germany are experiencing even lower storage levels, with its sites only about 57% full, raising concerns about supply security should the upcoming winter be particularly cold. Despite these figures, the European Commission, following a meeting of its Gas Coordination Group, stated that EU gas supply remains stable.