The war between the US and Iran has once again detonated European gas prices! Winter will reach a 17-year low, and the “gas shortage” will push up Dutch TTF futures by more than 70%

The Zhitong Finance App notes that European gas prices soared to the highest level since January 2023 after the escalation of the US-Iran war situation heightened concerns about long-term interruptions in energy supply in the Middle East.

Futures prices in the Netherlands, which is the benchmark for European gas, rose as high as 6.5% in recent months, and then narrowed some of the gains. The current price is more than 70% higher than in early July, when a temporary cease-fire agreement sparked hopes that the war could be resolved.

The US said on Tuesday that it has launched a new round of attacks on targets in Iran, further expanding this battle of alternating retaliation, and neither side is ready to relinquish control of the Strait of Hormuz.

Even before the latest escalation of the war, transportation of liquefied natural gas (LNG) through the Strait of Hormuz had almost come to a standstill. Europe has only one month left to replenish its gas reserves before winter sets in. The region's gas storage facilities currently hold only about 65% of reserves, which is the lowest level in history for the same period since records began in 2009.

Europe and Asia are vying for limited LNG supplies, and some South Asian buyers are also increasing their purchases. European gas prices need to remain high to attract more LNG fleets to its shores.

As of 9:02 p.m. Amsterdam time, futures prices rose 5.9% to 73.95 euros per megawatt hour.