European natural gas prices surge amid low storage levels

natural gas prices energy crisis EU gas storage fertilizer production inflationary pressure

European natural gas prices have surged, with October delivery contracts exceeding 75 EUR/MWh. This rise is driven by market concerns regarding supply adequacy and geopolitical tensions, including the conflict between the US and Iran affecting LNG shipping through the Strait of Hormuz.

EU gas storage levels are currently between 63% and 65%, which is significantly below the five-year average. Due to these conditions, the European Commission is considering lowering its seasonal storage target from the standard 90% to 80% or even 75% to provide market flexibility.

Analysts warn that prices could reach between 90 and 120 EUR/MWh during a cold winter. Such volatility poses a risk of a new inflationary shock and threatens energy-intensive industries. Specifically, high gas costs are forcing some European producers to limit or consider limiting ammonia and nitrogen fertilizer production, potentially increasing the continent's reliance on imports.

Experts suggest that to mitigate a full-scale energy crisis, the EU might need to consider new common debt mechanisms, such as a new Eurobond, to support economies against rising energy costs.

Entities

ACTOR Group · AKTOR Group · Alexandros Exarchou · European Commission · European Union · Gas Infrastructure Europe · Grupa Azoty · ICE · Marcin Celejewski · United States

Claims

What the coverage asserts, and how many sources carry each claim.

[● 2 SOURCES] European natural gas contracts for October delivery exceeded 75 EUR/MWh on September 2. biznes.interia.pl · www.efsyn.gr
[● 2 SOURCES] EU gas storage levels are between 63% and 65%, significantly lower than the five-year average. biznes.interia.pl · www.efsyn.gr
[○ 1 SOURCE] Natural gas prices could rise to between 90 and 120 EUR/MWh during a cold winter or if supply issues persist. biznes.interia.pl
[○ 1 SOURCE] Natural gas prices risk reaching 110 EUR/MWh, potentially causing a new inflationary shock in Europe. www.newmoney.gr
[● 2 SOURCES] High and volatile gas prices are increasing production costs for ammonia and nitrogen fertilizer manufacturers in Europe. www.wnp.pl · www.portalspozywczy.pl
[○ 1 SOURCE] Liquefied Natural Gas (LNG) accounts for approximately 45% of Europe's gas supply, with the United States providing up to 60% of that share. biznes.interia.pl
[● 2 SOURCES] Some European producers are already limiting or considering limiting ammonia production. www.portalspozywczy.pl · www.wnp.pl
[○ 1 SOURCE] The European Commission may lower gas storage target expectations to 75% or 80% if market conditions persist. energetyka24.com