European Gas Prices Surge 48 Percent as Hormuz Traffic Halts

(MENAFN) European natural gas prices rocketed as much as 48% intraday Monday after tanker traffic through the Strait of Hormuz — the narrow chokepoint connecting Middle Eastern energy production to world markets — largely ground to a halt in the wake of joint U.S.-Israeli strikes on Iran.

At the Dutch-based Title Transfer Facility (TTF), Europe's deepest and most liquid virtual natural gas trading hub, April futures surged to €47.2 ($55.2) per megawatt-hour intraday — a dramatic leap from the €31.95 per megawatt-hour recorded on Feb. 27, the last session prior to the onset of strikes.

The supply shock was compounded by a direct hit on Qatari infrastructure. QatarEnergy announced it had suspended liquefied natural gas (LNG) production after an Iranian-launched drone struck one of its energy facilities at Ras Laffan Industrial City in Qatar, sending fresh shockwaves through an already strained global LNG market and intensifying upward pressure on prices.

The strategic significance of the disruption is difficult to overstate. The Strait of Hormuz, a narrow passage at the mouth of the Persian Gulf, serves as the gateway through which Middle Eastern oil and LNG reach global buyers via the Gulf of Oman and the Indian Ocean. Approximately 20% of all global LNG exports transit the chokepoint. Qatar — among the world's largest LNG exporters — routes virtually its entire export volume through the strait to international customers.

While China and other Asian nations absorb the majority of LNG cargoes moving through Hormuz, any meaningful supply disruption carries immediate and outsized consequences for European markets, where buyers compete aggressively for redirected cargoes.

Those consequences are amplified by the state of European storage. The continent's gas inventories have fallen below 30%, a level that significantly heightens dependence on LNG imports and leaves prices acutely exposed to external supply disruptions — precisely the conditions now unfolding as military hostilities reshape energy flows across the Middle East.

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