European natural gas bourses rise as Q4 opens with persistent storage deficits

European and British wholesale natural gas prices climbed on Thursday as the fourth quarter commenced, buoyed by ongoing geopolitical tensions in the Middle East and lingering concerns over winter supply. The Dutch benchmark contract for the upcoming month rose 1.0% to 73.10 euros per megawatt-hour, hovering near recent peaks. In the United Kingdom, the comparable day-ahead contract for natural gas increased 0.7% to 184.00 pence per therm.

The winter heating season officially kicks off, with demand for stored reserves expected to decline as households and businesses turn up their thermostats. According to Gas Infrastructure Europe, EU underground storage sites remain about 12 percentage points below the same level from last year, leaving the region with a thinner safety net against sudden demand surges.

Competition for flexible seaborne Liquefied Natural Gas (LNG) shipments remains fierce, with Asian spot prices exerting upward pressure on European arrivals. Tensions surrounding the Strait of Hormuz have contributed to elevated risk premiums across the energy sector. The lingering dispute between the United States and Iran, coupled with the Strait of Hormuz blockade, has kept global oil prices elevated, including Brent crude, which in turn supports the broader natural gas market.

Analysts caution that with global shipping lanes potentially disrupted by the ongoing Middle East standoff, any unforeseen early chill in Western Europe could lead to swift depletion of reserves and a renewed surge in long-term gas contracts.