Average exchange prices for gas in Europe rose by 12pct MoM in October

European gas prices surged by 12% in October compared to the previous month, hitting an average of US$1,005 per thousand cubic metres, based on calculations by RIA Novosti using data from the ICE exchange in London. Prices kept rising throughout the month, breaking the US$1,000 barrier in the middle of October, driven by heightened tensions between Iran and the US, as well as disruptions in the Strait of Hormuz.

Low storage levels in European underground gas storage facilities also contributed to the price increase, reaching a record low of 74.58% by October 20. Europe transitioned from injecting gas into storage to withdrawing it, marking the start of the heating season. QatarEnergy's decision to extend a force majeure on liquefied natural gas supplies to Asian and European customers until the end of December also put upward pressure on prices.

The TTF index, Europe's largest gas hub in the Netherlands, saw its average settlement price for near-term futures reach US$1,005 per thousand cubic metres, peaking at US$1,204 on October 30, the highest since December 2022. The lowest price of the month was recorded at US$830.90 on October 2. In September, European gas prices rose by 20.3% compared to August, reaching US$897.10 per thousand cubic metres due to the Middle East conflict and the threat of a shipping shutdown through the Strait of Hormuz.

Gas prices started to climb in March, following the start of US and Israeli strikes against Iran, reaching a peak on March 19 at US$853.70 per thousand cubic metres, a level not seen since early January 2023. Prices were significantly higher in 2021-2022, with an all-time high of US$3,892 per thousand cubic metres in early spring 2022.