European natural gas prices have risen to 100 euros per megawatt-hour for the first time in nearly four years, intensifying concerns that an energy crisis could return as Europe enters its peak energy demand season.
European benchmark natural gas futures climbed as much as 4.1%, reaching their highest level since December 2022, with prices now more than triple what they were before the outbreak of the Iran war.
The conflict has added over 100 billion euros to Europe's fossil fuel import bill. Meanwhile, natural gas inventories remain at low levels compared to the same period in previous years, and the risk of further price surges continues to loom over Europe's economy.
Although European natural gas prices remain far below the peaks seen during the previous energy crisis, some parts of the region have already experienced social unrest due to rising living costs.
Signs of pressure on the manufacturing sector are also beginning to emerge, and the European Union has asked member states to consider measures to reduce energy demand.
Tom Marzec-Manser, Head of European Gas and LNG Research at Wood Mackenzie, said, "100 euros is undoubtedly an important psychological threshold that may create some resistance to further price increases. However, given the highly volatile geopolitical situation in the Middle East, especially with the upcoming U.S. midterm elections, European natural gas prices would not need much of a push to move even higher."
As of 2:37 PM Amsterdam time, the European natural gas benchmark Dutch front-month futures were up 3.8%, trading at 99.72 euros per megawatt-hour.
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