European Gas Prices Hit €75/MWh Amid Ongoing Middle East Tensions
The price of natural gas has hit €75 per megawatt-hour in Europe, matching levels seen during the 2022 energy crisis. This represents a 130% year-on-year increase and is largely attributed to the ongoing conflict between the U.S. and Iran.
As tensions persist in the Middle East, forecasts remain uncertain, and market experts warn that further price rises are possible. Swedbank economist Liis Elmik predicts that gas prices will continue to rise in the coming months due to geopolitical instability and low European gas reserves.
Kalvi Nõu, head of energy trading at Alexela, also expects further price increases, stating that a baseline for winter TTF prices could be around €70 per megawatt-hour. However, he notes that prices could temporarily rise above €100 if several adverse factors coincide.
The Strait of Hormuz has been identified as a key factor in the current market volatility, with the reopening of the strait potentially exerting significant downward pressure on gas prices.