The benchmark European natural gas price rose by 3 per cent at the opening of trading in Amsterdam on Friday as escalating tensions in the Middle East continued to restrict Qatari liquefied natural gas (LNG) supplies, while some European Union (EU) countries began drawing gas from storage amid falling temperatures.
The front-month contract at the Dutch Title Transfer Facility (TTF), Europe’s benchmark for natural gas trading, jumped by 3 per cent at 7 a.m. Amsterdam time on Friday.
Oil prices also rose, with Brent crude hitting a five-month high of $114 per barrel amid concerns that Houthi attacks could target Saudi Arabian energy facilities.
At $103.40 (€92.30) per megawatt-hour (MWh), the European gas price reached its highest level since December 2022, when Europe faced its first winter without most of its Russian pipeline gas supplies.
The current price is also equivalent to more than $30 per million British thermal units (MMBtu).
“European gas prices also remain extremely sensitive to developments in the Persian Gulf, with LNG flows increasingly likely to be largely absent from the market for at least much of the Northern Hemisphere winter,” ING commodities strategists Warren Patterson and Ewa Manthey wrote in a note early Friday.
The TTF benchmark rose by 3 per cent on Thursday, settling above €90 per MWh, its highest level since December 2022.
On Friday morning, the benchmark price exceeded €92 per MWh as the heating season approached, Qatari LNG supplies to Europe remained disrupted and gas storage facilities were only about 75 per cent full.
This was more than 10 percentage points below the five-year average.
EU gas storage facilities were 74.62% full as of October 22, according to data from Gas Infrastructure Europe.
This was significantly below the five-year average of about 86% for this time of year, with the heating season approaching.
“EU gas storage also appears to have peaked at just under 75 per cent full,” ING’s strategists said on Friday.
