economy
March 4, 2026
Gas prices spike amid fears of Middle East supply shock
European gas prices have skyrocketed as traders fear the escalation in the Middle East could hit shipments via the Strait of Hormuz
TL;DR
- European natural gas prices surged by around 50% due to increased Middle East tensions.
- The Strait of Hormuz, crucial for global oil and gas shipments, saw a halt in LNG tanker transit.
- A drone strike on QatarEnergy's LNG complex at Ras Laffan forced production to stop.
- Crude oil markets also rallied, with Brent futures reaching multi-month highs.
- Producers suspended operations in the Gulf as a precaution, with Saudi Arabia reportedly pausing activity at its Ras Tanura refinery.
- Analysts compare the current turmoil to the most serious shock in gas markets since the 2022 energy crisis.
- The EU is particularly exposed due to its reduced reliance on Russian imports and ongoing need for LNG.
- US President Trump indicated potential prolonged military operations against Iran.
- Major maritime insurers are considering stopping coverage for war risks in the Persian Gulf.
- Analysts estimate a month-long halt to shipping through the Strait of Hormuz could increase European gas prices by up to 130%.
- Russia's envoy highlighted the cost of Europe's move away from Russian gas.
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