EU gas prices hit four-year high amid Iran war

Disrupted LNG shipments and dwindling reserves have raised fears of another European energy crisis

European natural gas prices have surged to their highest level in four years amid the war in Iran and the EU’s continued push to phase out Russian energy supplies, according to data from online aggregator Trading Economics.

On Monday, wholesale prices briefly surpassed €97 ($108) per megawatt-hour, reaching levels not seen since December 2022. The increase came as the bloc’s gas storage facilities were just 74.62% full as of October 25, well below seasonal averages.

Liquefied natural gas (LNG) shipments through the Strait of Hormuz, which accounted for around a fifth of global LNG trade before the US and Israeli military campaign against Iran earlier this year, remained approximately 80% below pre-conflict levels.

Some EU countries have already begun drawing on stored gas as temperatures fall. Trading Economics forecasts that European gas prices will reach €98.20 per megawatt-hour by the end of the fourth quarter of 2026.

In the UK, the month-ahead gas contract rose by 4% to its highest level since December 2022, according to the Guardian. Brent crude, which climbed to $117 per barrel last week, has since eased slightly but remains around $115.

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British households could face a 27% increase in energy bills in January, pushing the average annual dual-fuel bill to nearly £2,200 ($2,940), according to a forecast by energy supplier EDF. An earlier forecast by consultancy Cornwall Insight had projected a 16% increase to approximately £2,000.

In August, the Guardian reported mounting concerns in the EU over low gas storage levels and soaring prices ahead of winter. In September, EU Energy Commissioner Dan Jørgensen warned that the bloc was facing its worst energy crisis since 2022.

In mid-October, German media reported that Berlin was planning to make households and businesses pay for a national emergency gas reserve costing more than €3 billion over ten years. The government-controlled stockpile would be reserved for emergencies, including sabotage and infrastructure failures, rather than used to lower gas prices.

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The reports came as the opposition Alternative for Germany (AfD) party called for restoring energy ties with Russia and following US President Donald Trump’s example. On October 13, AfD co-leader Alice Weidel said Germany should seek its own diesel deal with Moscow, praising Trump’s agreement with Russia as a pragmatic approach.

Following the EU’s sweeping sanctions on Russia in 2022, the bloc experienced one of its worst energy crises in decades. Gas prices soared above €300 per megawatt-hour, driving up costs for industries and households and contributing to surging inflation.

The EU has continued its efforts to phase out Russian energy. While Russia accounted for around 45% of the bloc’s gas imports in 2021, its share had fallen to approximately 12% by 2025.

Moscow has described the EU’s efforts to sever energy ties with Russia as a “suicidal” policy. Last week, Russian presidential investment envoy Kirill Dmitriev argued that the bloc would eventually have to restore those ties because “cooperation with Russia economically will be inevitable.”

Dmitriev also blamed the EU’s current problems, including high energy costs, on the bloc’s leaders, accusing them of refusing to acknowledge and correct their mistakes.