Europe gas rises as tanker threats counter surge in Hormuz LNG shipments

European and British wholesale natural gas prices surged on Tuesday, reversing earlier declines, as threats from tanker attacks in Middle Eastern maritime choke points overshadowed a broader recovery in seaborne fuel shipments. The Dutch front-month contract climbed 3% to 75.74 euros per megawatt-hour, while the British equivalent increased by 3 pence to 189.00 pence per therm.

This sharp rise in European gas prices follows a quiet beginning to the week, during which energy desks processed data revealing a substantial increase in regional supply flows. Maritime tracking data indicated that Liquefied Natural Gas (LNG) shipments exiting the strategic Strait of Hormuz reached their highest monthly level since February in September, thanks to the partial reopening of regional pipeline networks and loading terminals.

However, continuous drone and missile strikes on commercial tankers and energy facilities across the Persian Gulf and Red Sea have maintained premium shipping insurance rates and created unpredictable transit routes. Market participants remain highly vigilant for any disruption that could abruptly block seaborne LNG deliveries destined for Western European regasification terminals.

Underground natural gas reserves in the European Union have kept increasing ahead of the winter heating season, with EU gas storage caverns currently at 72% capacity, an improvement from the previous 66% recorded at the same period. Although these growing reserves provide a crucial safety net before winter heating demand, storage levels still fall short of historical levels, making regional gas prices highly susceptible to early cold snaps or geopolitical shipping delays.