Natural gas: European reference price climbs to just under 100 euros

On Monday, the European price for natural gas continued the high of the past few weeks to just under 100 euros per megawatt hour (MWh). The trend-setting natural gas futures contract TTF for delivery in one month rose to 97.64 euros per MWh on the Amsterdam stock exchange. That is almost three percent more than on Friday and the highest price since the end of the high price phase in 2022.

Recently, the gas price had reached multi-year highs several times. The increase was around a third in October alone, meaning the price of the raw material has more than tripled since the beginning of the year. The last time natural gas became more expensive was at the beginning of the Ukrainian war, although the price at that time jumped much higher to over 300 euros per MWh.

Pressure on industry and private customers

The current gas price inflation will primarily be felt by energy-intensive industrial companies, but ultimately private households will also be affected. In Baden-Württemberg, for example, natural gas has become 22 percent more expensive for end customers over the past twelve months, according to an analysis published in Heidelberg by the comparison portal Verivox. The supply of natural gas is usually regulated through contracts with longer terms. It will therefore take some time for the high world market prices to reach households.

The main price driver is the war between the USA and Iran. The US government recently ordered a more comprehensive evacuation of diplomatic personnel in the Middle East. In addition, American President Donald Trump indicated that US forces could resume attacks on Iran after the midterm elections on November 3rd. Iran, for its part, is preparing for retaliation. One of the world's most important transport routes for liquid natural gas runs through the Strait of Hormuz, which borders Iran.

Another price driver is the increased filling of German gas storage facilities before winter. As the largest European economy, Germany has been trying to increase gas reserves for weeks. Last month, state-owned company SEFE Securing Energy for Europe was ordered to procure additional gas for storage stocks. The German gas storage facilities are currently more than 61 percent full - for comparison: a year ago the storage level was around 75 percent.