European Natural Gas Prices Rise to €81.69 Per MWh on September 16, Up 2.04 Percent and 152 Percent Year-Over-Year as Hormuz Disruptions Tighten LNG Supply

European natural gas prices rose to €81.69 per megawatt-hour on September 16, up 2.04 percent from the previous day and 152.12 percent compared to the same time last year, according to Trading Economics. The price remained close to its highest level since late 2022, reflecting intensifying concerns over winter supply security as the Strait of Hormuz remains closed to most commercial traffic and diplomatic efforts to secure its reopening have stalled. LNG tanker traffic through the Strait has fallen sharply, tightening global supplies and intensifying competition with Asia and other buyers for available cargoes, Trading Economics reported. Meanwhile, ongoing maintenance at Norwegian gas facilities is adding another layer of uncertainty to Europe's winter supply balance. Europe's gas storage levels stand at around 68 percent of capacity, still below the seasonal average at a time when inventories would typically be close to maximum capacity ahead of the heating season. Chevron Australia president Balaji Krishnamurthy told Bloomberg TV on September 14 at the Gastech conference in Bangkok that LNG prices are unlikely to drop in the short term and will remain elevated for approximately the next six months. Australian LNG is now trading at a premium due to proximity to Asia, he noted, as buyers seek alternatives to disrupted Persian Gulf supplies. US LNG demand from Europe and Asia has risen sharply as buyers seek to replace disrupted Middle Eastern supplies and replenish inventories ahead of winter, with gas flows to nine major US LNG export plants increasing to 18.1 billion cubic feet per day in September from 17.2 bcfd in August.