European Gas Tops €90 per Megawatt-Hour for First Time Since December 2022

With Europe heading into winter with gas storage well below normal for this time of year, the continent's gas benchmark crossed a price line it has not touched in almost four years.

The Dutch TTF front-month contract rose as much as 2.4% today, Oct. 20, to roughly €90.2 per megawatt-hour. That is the highest since December 2022. The last close above €90 came on Dec. 22, 2022, at €91.94.

The move did not hold. Later in the session the contract slipped back to about €87, down roughly 1% from Monday.

How far prices have come

The contract ended 2025 at €28.16. Before the war with Iran began in late February with US and Israeli strikes, it traded near €32. It has more than tripled since January 1.

Monday's close was €88.04. The British front-month contract also hit its highest since Dec. 22, 2022, at 220.60 pence per therm.

Power followed. Germany's year-ahead electricity contract reached its highest level since July 2023.

The LNG squeeze

The driver is liquefied natural gas. Qatar supplied about a fifth of the world's LNG before the war, and most of that output is bottled up behind the Strait of Hormuz.

Some Qatari and UAE cargoes have passed through in recent weeks. LNG flows from the region remain around 80% below pre-war levels, according to Anadolu Agency, which is not enough to change the global balance.

Buyers in Europe and Asia are bidding for the same spot cargoes. Asia's benchmark LNG price hit $30.4 per million BTU on Monday, Oct. 19, its highest since December 2022 and about three times its pre-war level.

US supply matters here. ENTSOG data show US LNG deliveries to the EU fell to 5.42 billion cubic meters in July from 7.67 billion in January. The US share of EU LNG imports rose to 73.5% from 66.3% over the same period.

Shipping risk keeps the premium alive

United Kingdom Maritime Trade Operations (UKMTO) reported that on Oct. 17 a skiff carrying seven people fired two shots at an LNG carrier 140 nautical miles southwest of Al Mukalla, Yemen. The ship's armed security team answered with two warning shots and the skiff left. The next day, two projectiles hit a tug northeast of Khor Fakkan in the UAE.

The Houthis claim six operations against Saudi Arabia in 48 hours, including strikes on an Aramco site at Yanbu, the Shaybah field and Riyadh airport. Military spokesman Yahya Saree cited "a large number of ballistic and cruise missiles." Riyadh had confirmed none of the strikes by midday.

Brent crude gained 1.6% to about $111 a barrel. ING analysts say oil prices carry a risk premium because investors fear further disruption in Hormuz. US Energy Secretary Chris Wright says crude flows out of the Gulf have partly recovered to about 80% of pre-war levels. Prices stayed high anyway.

Storage: low, but still filling

EU storage was 74.58% full on Oct. 18, with 844.9 terawatt-hours in the tanks. The 2021 to 2025 average for that date is 89.2%, a gap of 14.6 points. In 2024 the figure was 95.1%.

The national picture varies. Germany, Europe's largest gas consumer, sat near 61%. The Czech Republic was around 77%.

There is a counterpoint in the data. Injections on Oct. 18 totaled 1,760 gigawatt-hours against withdrawals of 612, and inventories have risen by an average of 1.2 TWh per day over the past week. Europe is still adding gas, just from a lower base and at a higher price.

Analysts attach a weather condition to the outlook. Martin Pacovský, investment director at the Arete Energy fund, told the Czech News Agency late last month: "There isn't enough gas in Europe for us to ignore the prospect of a harsh winter. If several weeks of severe frost hit Germany, Czechia and other countries at the same time, Europe would compete fiercely for every additional supply. And price would be the main tool in that competition."

The price outlook depends largely on weather conditions, the trajectory of imports and how long supply disruptions persist. A colder-than-usual winter combined with prolonged restrictions on energy flows could trigger further sharp increases. A reopening of the Strait of Hormuz to Qatari LNG tankers would push spot prices down.