Europe's Natural Gas Prices Hit Multi-Year Highs as Strait of Hormuz LNG Disruption Threatens Winter Storage

European benchmark natural gas prices have surged to their highest levels since January 2023, climbing over 70% since July following the Iran conflict, which severely disrupted liquefied natural gas (LNG) flows through the strategic Strait of Hormuz.
The supply shock comes at a critical juncture, leaving Europe with just one month to accelerate winter storage injection while tanks sit at a meager 65% capacity. A severe cold snap amid constrained inventories and severed Hormuz shipping routes risks triggering mandatory energy rationing.
The crisis immediately pressures European heavy industry through surging input costs and compressed margins, while weighing on the euro and leaving the European Central Bank with limited room to maneuver against tightening financial conditions.