European gas prices continued their recent rally on Monday, climbing to just under 100 euros ($110.54) per megawatt-hour (MWh) and marking the highest since 2022 amid the conflict in the Middle East.
The benchmark Title Transfer Facility (TTF) natural gas futures contract for delivery in one month rose on the Amsterdam exchange to 97.64 euros per MWh. That is almost 3% more than on Friday and the highest price since late 2022.
Gas prices recently reached multi-year highs several times. However, a fresh surge adds to further woes just before the start of the winter season on the continent.
Since the start of the month, the price has risen by about a third, and since the start of the year, it has more than tripled.
Natural gas last rose sharply at the start of the Ukraine war, when the price jumped much higher, to over 300 euros per MWh.
Intensifying conflict in the Middle East has sharply heightened concerns over winter energy supplies, particularly as liquefied natural gas (LNG) flows from the Persian Gulf – which previously accounted for nearly a fifth of global supply – remain down roughly 80% year-over-year.
The rising gas prices are also adding pressure on consumers and industry.
In the south-western German state of Baden-Wurttemberg, for example, gas for private households has become 22% more expensive in the past 12 months, according to an analysis published in the city of Heidelberg by the comparison portal Verivox.
Gas supplies are usually governed by longer-term contracts. As a result, it takes a while for high global market prices to reach households.
The main driver of prices is the Iran war. One of the world's most important transport routes for liquefied natural gas runs through the Strait of Hormuz, where shipping traffic has effectively come to a standstill due to the war.
Another factor pushing prices up is the increased filling of gas storage ahead of the European winter.
Germany, Europe's largest economy, has for weeks been working to increase its gas reserves. German gas storage facilities are more than 61% full. A year ago, the storage level was around 75%.
Overall, Gas Infrastructure Europe (GIE) reported that EU gas storage facilities are at just 74.6% of capacity, well below historical seasonal averages.
