European Gas Prices Soar Amid Persian Gulf Disruptions

European natural gas prices have reached their highest level since December 2022 after rising above €82/MWh on Friday.

This surge is due to persistent disruptions to liquefied natural gas (LNG) supplies from the Persian Gulf, which has been affected by fighting between the US and Iran over control of the Strait of Hormuz.

As a result, around 20% of global LNG flows have been disrupted, primarily impacting shipments from Qatar. Europe's gas inventories are still depleted, with storage sites at just 67% capacity, the lowest level for this time of year since records began in 2009.

The European Commission has stated that there is no immediate risk to gas security this winter, but a sustained disruption could lead to further tightening of global supply and higher prices as heating demand increases.