No end in sight

Attacks on Iran are now causing gas prices to skyrocket

The facility in Ras Laffan was hit hard overnight by ballistic missiles from Iran—it is Qatar’s most important site for the production of liquefied natural gas.(Bild: AFP/-)

The escalation in the Middle East is hitting energy markets with full force: Following severe attacks on Qatar’s central liquefied natural gas facilities (used for so-called LNG), gas prices in Europe are skyrocketing—and there is no end in sight for the time being.

On the Amsterdam exchange, the benchmark TTF natural gas futures contract for delivery in one month rose by 24.5 percent to 67.89 euros per megawatt-hour (MWh) early Thursday morning. The tense situation also caused significant volatility in the oil market: The price of North Sea Brent crude rose at times to over $115 per barrel.

Significant damage from attacks
The price surge was triggered by attacks on liquefied natural gas (LNG) facilities in Qatar that are crucial to the global market. According to reports from Doha, the Ras Laffan industrial zone—home to key facilities for the production and shipment of LNG—was once again targeted by Iranian missile strikes. Civil defense teams fought a fire; no injuries were reported.

The operator, Qatar Energy, had previously reported fires and significant damage. Qatar is one of the world’s leading producers of liquefied natural gas, with a large portion of its exports handled through Ras Laffan. Production and transport—particularly via the strategically important Strait of Hormuz—are currently largely disrupted.

Trump threatens massive military response
The situation is further exacerbated by political threats. U.S. President Donald Trump announced that, in the event of further attacks on Qatar’s gas industry, he would order a massive bombing of the Iranian “South Pars” gas field. Such an attack would be carried out with “strength and force” never seen before, he wrote on the Truth Social platform.

At the same time, Trump stated that Israel would not attack this gas field again—as long as Iran ceases its attacks on Qatar. The “South Pars” gas field, which Iran and Qatar share, is considered the world’s largest known gas reserve and is central to the region’s energy supply.

Concerns About Shortages Grow
As the war in the Middle East enters its third week, concerns about long-term supply shortages are growing. Restrictions on shipping through the Strait of Hormuz had already strained the supply situation. Asian countries in particular, which are heavily dependent on supplies from the Gulf region, are increasingly turning to the European market.

The recent attacks on gas facilities are further exacerbating the situation. Market observers believe that the supply of natural gas could be disrupted even in the longer term.

Gas price more than doubled since the start of the war
Before the military escalation began, the TTF price was still around 31 euros per MWh—since then, it has more than doubled. The sharp rise is also likely to make refilling European gas storage facilities significantly more difficult this year. Since gas-fired power plants play an important role in electricity generation, particularly in winter, electricity prices could also rise further.

Oil prices rise sharply
Uncertainty is also clearly evident in the oil market. The North Sea Brent crude briefly rose to more than $115 per barrel on Thursday before settling at around $113—an increase of about 5.5 percent compared to the previous evening.

The increase was significantly more moderate for the U.S. WTI grade, which rose only slightly to just over $96. The price difference between Brent and WTI is now the widest it has been since early 2015.

Hope for U.S. Action
One reason cited is the expectation that the U.S. might take measures to cushion the impact of the crisis on energy markets. Treasury Secretary Scott Bessent stated, however, that there had been no intervention in the energy futures market to date.

According to analysts, the U.S. government could nevertheless consider steps such as a tax on crude oil exports or even an export ban to curb rising energy prices.