European Gas Prices Climb Toward Multi-Year Highs on Tight Supply

· Oil & Gas · European Union

Europe's main natural gas benchmark is heading for multi-year highs despite a reported "energy ceasefire" between Russia and Ukraine and improved energy flows through the Strait of Hormuz. The continent is entering winter without Qatari LNG exports and with storage levels well below the seasonal norm, a gap widened by the fact that Persian Gulf LNG flows remain more than 75% below their pre-February 28 levels. In Europe, the November gas benchmark was trading above 81 euros per MWh, while Asian spot LNG prices have topped European levels, drawing cargoes away from Europe and intensifying competition for winter supply. Benchmark crude also rose about 2% to near two-week highs after fresh attacks on Saudi Arabia and oil tankers near the Strait of Hormuz, though the market weighed additional Russian diesel supplies and a Russia-Ukraine energy truce.

Why it matters：A supply-tight European winter affects utilities, industrial consumers and global LNG traders, and signals that geopolitical risk premia in energy markets are far from unwinding.

Key points

  • Persian Gulf LNG flows remain over 75% below pre-February 28 levels
  • November European gas benchmark topped 81 euros per MWh
  • Asian spot LNG prices now exceed European prices, pulling cargoes eastward

Sources (original reporting)

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