UBS raises European gas price outlook on Gulf LNG disruptions

UBS has revised its price forecasts for European gas, citing prolonged disruptions to liquefied natural gas (LNG) exports from the Gulf region and tighter storage levels across the European Union. The firm now expects gas prices to reach €75 per megawatt-hour, or $25 per million British thermal units, in the fourth quarter of 2026, up from the previous estimate of €62. For 2027, the forecast has been adjusted to €45, or $15, compared with €40 earlier.

The adjustments also extend to other gas prices, with UBS maintaining a $1 premium over the TTF. The firm anticipates that negotiations will progress toward year-end, supporting stable shipping activity and LNG flows. However, UBS expects LNG supply to recover more slowly than oil, while low storage levels and the phase-out of Russian gas continue to tighten the market.

Looking beyond 2027, UBS’s long-term forecasts remain largely unchanged, with prices expected to be €30, or $10, in 2028, €22, or $8, in 2029, and €21, or $7, in 2030. In contrast, the firm has cut its Henry Hub price forecasts for the United States to $3.50 per million British thermal units in the fourth quarter of 2026 and 2027, down from around $3.8 previously.