The threat of closing the Strait of Hormuz has caused a surge in energy prices.
Energy markets responded to the military escalation between the U.S. and Iran, which raises concerns about supply disruptions through the Strait of Hormuz, leading to an increase in oil and natural gas prices.
Amid a new wave of tension in the Middle East, energy prices have risen sharply. Natural gas prices in Europe reached a monthly high, with the benchmark Dutch futures rising by 3.5% to €50.37 per megawatt-hour. In the UK, prices increased by about 4%.
The escalation occurred following reports of potential closure by Iran of the Strait of Hormuz, through which about a fifth of the world’s liquefied natural gas (LNG) exports pass. Although the U.S. Central Command stated that the passage remains open, the market reacted to the risks of potential restrictions.
The oil market also sees an increase: Brent futures rose by nearly 4% to $78.98 per barrel, while WTI increased by approximately 4% to $74.26 per barrel.
Events in the Middle East have heightened regional tensions, as Iran launched missile attacks in response to U.S. actions, leading to the threat of disruptions in transit through a key maritime artery. Vessel activity in the Strait of Hormuz has significantly decreased, as confirmed by data from the Kpler service.
Experts warn that high volatility in energy markets will persist, which could have long-term consequences for the global economy. In Europe, gas storage is filled at 47%, lower than the previous year. This increases the risks for the region ahead of winter and could intensify competition for supplies between Europe and Asia.
| Energy Resource | Price Increase | New Price |
|---|---|---|
| Natural Gas (Europe) | 3.5% | €50.37/MWh |
| British Gas | ~4% | – |
| Brent | 4% | $78.98 per barrel |
| WTI | 4% | $74.26 per barrel |
