European natural gas prices surged to yearly highs as escalating Middle East tensions threatened the supply of critical LNG. TTF gas futures opened Week 09 at €31.456/MWh on Monday, February 23, before softening to €30.553/MWh the next day, a -2.9% decline, marking the week’s lowest price amid mild fundamentals and limited short-term demand pressure. By mid-week, the contract staged a recovery, climbing to €32.148/MWh on Thursday, a +3.9% rise — the highest price of the week — before stabilizing at €31.959/MWh on February 27, reflecting a relatively balanced market environment heading into the weekend. The weekly average for Week 09 stood at €31.41/MWh, slightly -0.4% below the previous week’s level.
However, the start of the following week saw a dramatic jump, with prices on March 2 soaring to €44.506/MWh, a +41.5% week-on-week increase, representing one of the largest single-day upward moves in recent months. Europe’s market vulnerability was compounded not only by geopolitical risk but also by low gas storage levels, with Germany at 20.5% and France at 21%, according to Gas Infrastructure Europe. Meanwhile, the one-month forward TTF contract traded at €52.540/MWh ($16.71/MMBtu) as tensions persisted.
Throughout Week 09, natural gas prices trended higher as markets anticipated an escalation in US-Iran tensions. Diplomatic efforts in Geneva over Iran’s nuclear program yielded no progress, and warnings from President Trump suggested Iran was not negotiating in good faith. Multiple nations, including the US and China, advised their citizens to evacuate some areas, a precaution later validated by the US and Israeli attacks on Iran on February 28. Retaliatory strikes followed, with Iran launching missiles at neighboring countries hosting US military assets.
A key market concern remains Iran’s influence over shipping in the Strait of Hormuz, a vital artery for global energy trade. Roughly 20% of all oil and LNG shipments pass through this narrow waterway, which is just 33 km wide at its narrowest point, with shipping lanes only 3 km each way. The conflict caused immediate disruption in LNG transport, particularly affecting European and North Asian supply. Qatar, one of the world’s largest LNG exporters and Iran’s neighbor, saw exports nearly halted, which is expected to further drive price surges this week.
In addition, Israel temporarily shut down parts of its natural gas production following the strikes. The Leviathan field, operated by Chevron, ceased operations, and the Karish floating production unit, managed by Energean, was also suspended. Israel’s Energy Ministry confirmed that alternative sources would meet domestic needs and that power stations were prepared to operate using alternative fuels if necessary.
Overall, the combination of geopolitical risk, low storage levels, and disrupted LNG flows contributed to heightened market volatility, pushing European natural gas prices to their highest point in over a year.
