European Gas Prices Spike Amid Ongoing Tensions Over Strait of Hormuz

European gas prices surged by 4% on Thursday as tensions over the Strait of Hormuz remained unresolved. The benchmark natural gas price at the Dutch Title Transfer Facility rose to $84.30, or 74 euros, per megawatt-hour.

The recent spike in prices follows a month-high of $93, or 82 euros, per megawatt-hour, seen in January 2023 during Europe's first winter with Russian pipeline gas supplies cut off.

Despite the recent decline, concerns over limited liquefied natural gas (LNG) flows from the Middle East continue to weigh on European prices. The Strait of Hormuz, a critical waterway for global LNG trade, remains a key concern as some cargoes have failed to transit through the area in recent weeks.

The unresolved impasse between Washington and Tehran has led to increased worries about global LNG supply disruptions, with Fitch Ratings upgrading its TTF gas assumptions for this year and next due to the Iran conflict.