Gas Prices in Europe Reach 4-Year High

The ongoing conflict and political instability in the Middle East have sparked renewed, intense concern regarding winter energy supplies globally. As a direct consequence, natural gas prices in the European Union (EU) have surged, reaching their highest level in four years (since 2022).

Following the close of trading last Friday, the European gas benchmark rose by 3.3% as markets reopened this Monday. This pushed the price per megawatt-hour (MWh) of gas beyond 97 euros (approximately $108.8)—a level not seen since December 2022.

The primary driver of this complex situation is a sharp decline in the supply of liquefied natural gas (LNG) from the Persian Gulf region. This region typically accounts for about one-fifth of global LNG demand; however, due to the ongoing conflict, gas supplies from this area have dropped by nearly 80% compared to the same period last year.

Meanwhile, Europe’s own energy security buffer remains precarious. According to data from ‘Gas Infrastructure Europe,’ gas storage facilities across EU member states are currently at only 74.6% of their total capacity—a figure significantly lower than the seasonal average for this time of year.

Caught between shrinking global supplies and dwindling domestic reserves, Europe’s energy market has become highly volatile, even before the onset of the harsh winter season.

Source: Anadolu Agency