Gas prices in Europe continue to rise, nearing the psychological threshold of €100 per MWh

The wholesale price of gas for the European market continued to rise today, surpassing €97 (around CZK 2,350) per megawatt-hour (MWh) for the first time since 2022. It is thus nearing the psychologically important threshold of €100 per MWh. The increase is driven by concerns about supplies during the winter months and the course of the conflict in the Middle East, Bloomberg reported.

At around 9:45 CET, the price of the key front-month gas futures contract at the Title Transfer Facility (TTF) virtual trading hub in the Netherlands was up nearly four percent, trading close to €97.50 per MWh.

The conflict in the Middle East, which began in late February with U.S.-Israeli strikes on Iran, has disrupted shipping through the strategically important Strait of Hormuz. Around one-fifth of the world’s liquefied natural gas (LNG) supplies normally pass through it. LNG has played a key role in supplying gas to Europe since the energy crisis in 2022, Bloomberg notes.

According to data from Gas Infrastructure Europe (GIE), EU gas storage facilities were just under 75 percent full over the weekend. In Germany, Europe’s largest gas consumer, storage facilities were around 61.5 percent full, while in the Czech Republic the figure was over 77 percent.

Traders expect demand for gas for heating in Europe to rise in the coming days, as colder weather is forecast. At the same time, the global gas supply situation is not expected to improve significantly in the near future. European buyers will therefore likely have to compete for gas supplies with customers in other parts of the world, such as Asia.