Europe Faces Gas Price Crisis Ahead of Winter

The European Union is facing a natural gas storage crisis ahead of winter, as low inventories and supply constraints could push prices above €100 per megawatt-hour for the first time since the energy crisis four years ago.

According to Gas Infrastructure Europe, EU gas stores are at around 63%, which is one of the lowest levels on record for this time of year. The five-year average is roughly 18 percentage points higher.

Tancrede Fulop, senior equity analyst at Morningstar, told CNBC that a cold winter combined with continued supply constraints could send prices to between €90 and €120 per megawatt-hour.

Analysts at Goldman Sachs warned in a note published Sunday that if Middle East LNG exports 'normalize only gradually through 2027', natural gas futures would need to rise above €100 per megawatt-hour to curb Asian demand enough for Europe to manage its storage levels through winter.