AMSTERDAM (dpa-AFX) – The price of natural gas rose sharply after Israel and the USA attacked Iran. At the start of trading on Monday, the quotation for the trend-setting futures contract TTF for delivery in one month on the Amsterdam stock exchange jumped to 39.85 euros per megawatt hour (MWh). That is around 25 percent more than on Friday and the strongest price jump since August 2023.
This means that European natural gas is as expensive as it was last in January, when low temperatures in large parts of Europe and comparatively low gas storage levels drove the price up to over 40 euros at times. In February the prices fell noticeably again to around 30 euros per Mwh.
At the weekend, Israel and the USA attacked Iran, killing, among others, the country’s head of state and religious leader Ayatollah Ali Khamenei. Iran responded with counterattacks and also restricted shipping through the Strait of Hormuz, a key choke point for global energy trade.
Market observers see the risk of further price increases and believe that dimensions similar to those seen when Russia invaded Ukraine are possible if the conflict lasts longer and escalates further. A large part of the natural gas is delivered to Asia from the Persian Gulf region. However, an interruption in deliveries of liquid gas through the Strait of Hormuz is likely to intensify competition for alternative sources of supply and drive up prices worldwide, including in Europe.
In Europe, gas stocks are comparatively low after winter and the region will need to import large quantities of liquefied natural gas this summer to replenish them before next winter. Analysts at US investment bank Goldman Sachs do not want to rule out a further increase in gas prices. If shipping traffic through the Strait of Hormuz were to be suspended for a month, European gas prices could more than double, according to Goldman Sachs./jkr/mis/stk
