Goldman Sachs Sees European Gas Prices Staying High as Winter Nears

European natural gas prices are expected to remain high as winter approaches, according to Goldman Sachs Research. The firm cites continued interruptions to Middle Eastern liquefied natural gas flows and thin storage in Northwest Europe as the main factors.

The recent surge in European LNG prices has been driven by a 70% increase since July, with prices reaching EUR73 per megawatt hour as of September 21. However, trading has been volatile due to shifting news about the Middle East conflict, including a recent drop of over 10%.

Goldman Sachs' commodities analysts expect prices to average EUR70 per megawatt hour in the fourth quarter of 2026, significantly above the pre-war range of EUR30 to EUR60 per megawatt hour. This forecast is based on the assumption that Persian Gulf LNG exports will remain at only 15% to 25% of their pre-war levels.