European Gas Prices Surge Past Conflict-Driven Highs
European natural gas futures have seen their fourth consecutive week of gains after rising past conflict-driven highs to touch their highest levels since 2023. The front-month Dutch TTF contract rose modestly on Friday, holding near 72.50 euros per megawatt-hour (MWh). This puts the continental benchmark on track for a weekly gain of over 8%.
The sustained weekly advance is underlined by a deep-seated geopolitical risk premium embedded across forward curves. Energy desks continue to re-price winter supply commitments after direct military strikes between U.S. forces and Iran effectively crippled commercial tanker transit through the Strait of Hormuz earlier in the week.
While Washington maintains that international shipping lanes remain open, satellite tracking data reveals that commercial vessel traffic through the strategic bottleneck is operating at a small fraction of normal pre-war levels. This directly threatens approximately 20% of global liquefied natural gas (LNG) supplies, predominantly originating from major producer Qatar.