European gas prices spike as U.S.-Iran strikes threaten Hormuz supply route

European natural gas prices whipsawed this week after President Donald Trump declared the fragile U.S.-Iran ceasefire "over," triggering fresh airstrikes and reigniting fears of supply disruptions through the Strait of Hormuz.

The Dutch TTF benchmark, Europe's most liquid gas trading hub, surged above €49 per megawatt-hour on Tuesday and Wednesday, reaching levels not seen in roughly a month, according to pricing data from ICE and Yahoo Finance. The spike came as the U.S. military launched strikes on approximately 90 sites across Iran, with U.S. Central Command saying on Wednesday that forces were "conducting additional strikes against Iran to further degrade their ability to threaten freedom of navigation in the Strait of Hormuz".cnn+3

Geopolitical Trigger

The escalation marks the most severe breakdown since both sides signed a memorandum of understanding in mid-June aimed at ending hostilities, according to Al Jazeera. Trump, speaking aboard Air Force One from the NATO summit in Turkey, characterized the campaign not as a war but as "a de-nuking of Iran," adding that "the focus here is on eliminating nuclear weapons, ensuring Iran does not possess them".nbcnews+1

Iran retaliated by launching strikes against three Gulf nations, triggering alerts among U.S. allies including Qatar, Bahrain, and Kuwait, NBC News reported. Tehran's health ministry said at least 14 people were killed and 78 injured during the two-day U.S. bombardment. Trump said he would allow negotiations to continue despite declaring the ceasefire finished.nbcnews+1

Storage Concerns Amplify Risk

The geopolitical turmoil lands on a European gas market already under strain. Storage filling rates are lagging behind both last year's pace and the five-year average, with analysis by Timera Energy warning that inventories could reach only 70–75% by the start of winter, below the EU's 80% storage objective. Europe entered the 2026 injection season with its lowest storage levels since 2018, at 31 billion cubic meters, according to Columbia University's Center on Global Energy Policy.europeangashub+1

An earlier heatwave forecast for northwestern Europe and Italy had already pushed prices higher in recent days, with lower pipeline gas flows from Norway — Europe's largest supplier — adding further support, Anadolu Agency reported. TTF prices had rebounded roughly 20% over the two weeks preceding Thursday's session.asymmetricresearch.substack+1

Outlook

The EU's Gas Coordination Group said on July 1 that there were "no immediate concerns" about supply security for next winter, though the Commission stressed the importance of "continued coordination and preparedness in view of the evolving market situation". With the Strait of Hormuz — a chokepoint for global LNG shipments — now at the center of an active military confrontation, traders face the prospect that any further escalation could tighten an already competitive global LNG market where European and Asian buyers are vying for the same cargoes.energy.europa