European Gas Prices Soar as Tehran Threatens Hormuz Restriction
European natural gas prices have surged by 2% to near multi-year highs as tensions escalate in the Persian Gulf. The Dutch front-month contract rose to trade around 73.80 euros per megawatt-hour (MWh), while the equivalent NBP wholesale gas contract in Britain advanced 2% to trade at 182.50 pence per therm.
The price increases reflect growing concerns over supply security as Iran threatens to declare a restricted zone outside the Strait of Hormuz, which handles roughly one-fifth of global LNG traffic. This has led European utilities to bid aggressively for uncommitted Atlantic basin LNG cargoes to fill potential deficits.
Data from Gas Infrastructure Europe shows regional storage facilities filled to around 62% of capacity, trailing the five-year seasonal average by about 17 percentage points. With winter approaching and storage replenishment running behind schedule, traders are warning of a high risk of price spikes and supply rationing.