Europe Gas Prices Soar Amid Middle East War Disruptions

European liquefied natural gas prices have skyrocketed due to supply disruptions caused by the war in the Middle East, reaching their highest level since January 2023. Buyers are paying $22.83 per 1 million British thermal units, more than double the price from a year ago.

The war has led to significant drops in shipments through the Strait of Hormuz, with only eight tankers carrying liquefied natural gas leaving the region in July compared to an average of three vessels per day before the conflict began. This reduction in LNG supplies has affected all importers, but Europe is particularly vulnerable due to low gas storage levels on the continent.

Gas markets have been more severely impacted than oil markets, where prices have also risen this year, as transporting gas requires complex and expensive vessels. Despite some shipments of crude oil leaving the Persian Gulf, their volumes remain lower than pre-war levels.