European gas prices briefly hit €100/MWh as winter supply concerns intensify

Europe's benchmark natural gas contract briefly touched €100 per megawatt hour on Wednesday, reaching its highest level since December 2022. The move came as disruptions to liquefied natural gas shipping from the Middle East kept supply tight ahead of winter. The spike adds to pressure on consumers and industry already facing elevated energy costs.

The Dutch front-month contract at the TTF hub briefly traded at €100 per MWh at around 1.35pm Irish time, according to market data from the Intercontinental Exchange. It was up about 4% from the previous session. German front-year baseload power rose 1.7% to €159.30 per MWh, its highest level since June 2023, while the French equivalent reached €122.50 per MWh, a near two-year high.

The price rise comes as Europe enters the heating season, when demand for gas typically increases. Storage levels are lower than last year, with Europe's gas storage nearly 75% full and Germany's around 60%, leaving less of a cushion if supply is disrupted further. Analysts said the continent's LNG imports were 30% below last year for the week ending 9 October, underscoring the strain on supply.

The latest move matters because gas prices feed directly into electricity costs in many European markets, especially when gas-fired plants set the price during periods of high demand. Higher wholesale prices can also affect energy-intensive industries such as chemicals, fertilisers and steel, which rely on gas either as a fuel or as a raw material. The increase comes at a time when households and businesses are already dealing with the effects of high energy bills.

The report also linked the broader energy shock to the conflict in the Middle East, which has raised costs for oil, transport fuels, gas, electricity and food. It said prices are now trading at around triple pre-war levels, and that forecasters expect high gas prices to persist for at least another year even if the war ends and winter is mild. That assessment reflects Europe's need to refill storage after a period of heavy use and reduced imports.

What remains unclear is how long the current price spike will last and whether colder weather later in the winter will push demand higher still. A gas producer's chief executive warned that Europe could face another jump in prices if temperatures fall sharply. Market participants will be watching storage levels, LNG arrivals and any further disruption to shipping routes in the weeks ahead.

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