European natural gas prices surged this Monday, with the benchmark price on the Dutch TTF market exceeding 70 euros per megawatt-hour. The sharp increase occurs amid a context of renewed geopolitical tension in the Middle East region.
The resumption of fighting between the United States and Iran has been identified as the main cause of this rise. Iran is a significant player in energy production and exports in the region, and any escalation of violence immediately generates uncertainty in global energy markets.
This new episode of conflict has fueled fears of new delays in liquefied natural gas (LNG) exports from the Persian Gulf. The region is one of the main sources of LNG supply for Europe, and disruptions in export flow have a direct impact on European markets.
