European Natural Gas Price Hits Three-Year High Amid Geopolitical Tensions
The European natural gas price has hit a three-year high of 80 euros per megawatt-hour, according to trading data from September 10th. This surge comes on the heels of geopolitical tensions in the Middle East, which have been driving up prices since March.
The Strait of Hormuz, through which approximately 20% of the world's natural gas is shipped overseas, has been significantly disrupted due to recent attacks. The main gas sources for this region come from Qatar, and any disruption to shipping routes directly affects global LNG supply.
Europe's current gas storage situation is also a concern, with inventory levels at only 65.6% of total capacity as of September 10th, according to the British Financial Times. This is the lowest level in 15 years, and experts warn that replenishing storage before winter may be difficult.