European natural-gas prices climbed 2.4 percent to 73.73 euros a megawatt-hour as Qatar's extended force majeure on LNG shipments to Edison through early November leaves the market thinly supplied, with EU storage at 66 percent full, below the seasonal average, heading into the 2026/27 winter heating season.
The benchmark Dutch TTF contract rose 2.4 percent to 73.73 euros a megawatt-hour in early European trading on Monday, holding just below 74 euros, as Qatar's decision to extend force majeure on LNG deliveries to Italy's Edison through early November deepens concerns about supply entering the 2026/27 heating season. Front-month futures trading above later-dated contracts has discouraged utilities from refilling caverns through the summer, leaving the market with little cushion.
"LNG has not been flowing out as much as crude oil, leaving the gas market increasingly vulnerable as we near the 2026/27 heating season," ING commodities strategists Warren Patterson and Ewa Manthey wrote in a note. QatarEnergy, one of the world's largest LNG exporters, recently extended force majeure on shipments to Edison, its seventh month of a suspension that began with missile attacks on Ras Laffan in March.
The extension brings the number of cargoes affected under Edison's 25-year contract for 6.5 billion cubic metres a year to 29, representing about 3.8 billion cubic metres of gas. Edison said it had already replaced 21 of those cargoes, equivalent to roughly 2 billion cubic metres, and could continue meeting commitments to customers. The disruption has cut Qatar's total LNG export capacity by 17 percent, removed about 80 million tonnes a year from global markets and cost the producer an estimated $20 billion in annual revenue, prompting Doha to trim its government budget by around 30 percent.
EU gas storage stood at just under 66 percent full by the end of last week, the lowest level for this time of year in nearly two decades and well below the five-year average of more than 80 percent. The bloc holds almost 67 billion cubic metres in storage and is adding about 9 billion cubic metres a month, but a cold winter would require withdrawals of 72 billion to 77 billion cubic metres. At current prices, Europe still needs to buy more than $8.1 billion of gas to reach even its lowest storage target of 75 percent, according to calculations by Bloomberg.
The thin buffer reflects a summer in which elevated spot prices and repeated assurances that the Strait of Hormuz would reopen kept forward winter prices below those for summer delivery, discouraging utilities from filling caverns. Withdrawals typically begin between late October and mid-November, and when stocks run low the maximum withdrawal rate from storage facilities drops off, leaving less room for error during a cold snap.
Greece's Deputy Energy Minister Nikos Tsafos, who has argued current levels should prove adequate, points out that European gas demand has fallen sharply since Russia's invasion of Ukraine. Consumption across Europe, including the UK and Ukraine, dropped from 572 billion cubic metres in 2021 to 482 billion cubic metres last year. But unlike before late 2021, the continent can no longer call on a surge of Russian pipeline supplies in a bleak midwinter, and the UK, a major importer with falling domestic output and very limited storage, is particularly exposed. Gas meets two-fifths of European heating demand.
The squeeze is hitting hardest those buyers that relied on Qatari or Emirati LNG and lack long-term contracts elsewhere. Bangladesh paid $28.03 per million British thermal units for four spot cargoes on Friday, equal to $163 a barrel of oil, while Pakistan retendered after rejecting bids near $27 per million British thermal units as too costly. Anne-Sophie Corbeau, a global research scholar at Columbia University's Center on Global Energy Policy, said the countries most at risk were those dependent on short-term purchases, singling out Pakistan, Bangladesh and India as particularly vulnerable.
Other exporters have filled part of the gap. US LNG exports averaged 17.4 billion cubic feet a day in the first half of 2026, up 23 percent year on year, and the United States supplied two-thirds of European LNG imports last month. Output has also strengthened in Nigeria and Malaysia. Yet replacement supplies have not covered the entire shortfall, and Corbeau said the prolonged loss of Qatari and Emirati volumes could push global LNG trade lower in 2026 even as output grows elsewhere.
QatarEnergy has said it could restore output from its 12 undamaged production units within about two months once it is satisfied the strait is secure, but repairs to two other units damaged in attacks on Ras Laffan could take three to five years. A brief resumption of LNG movements after a June memorandum between the US and Iran did not last, and the June ceasefire has since expired with diplomacy stalled. New liquefaction capacity in the US, Canada, Australia and Nigeria should gradually add non-Qatari supply, though Corbeau estimates it could take until 2028 for the global market to return to the supply-demand balance previously expected by mid-2026.
This article is for informational purposes only and does not constitute investment advice.
