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Investing.com -- European natural gas prices soared Monday as renewed fighting in the Middle East fueled fears of a major disruption to global energy supplies. The escalation threatens to deliver the most significant shock to gas markets since Russia’s invasion of Ukraine four years ago reshaped global energy trade.
Gas prices further surged Monday after QatarEnergy said it will halt all natural gas production after Iranian drone attacks targeted its facilities. The state-owned company accounts for nearly 20% of global LNG exports.
As of 14:36 GMT (09:36 ET), Dutch TTF Natural Gas Futures surged as much as 45.7% to 46.55 €/MWh while Natural Gas Futures were up 3.8% to $2.98.
Goldman Sachs said a month-long halt to shipping through the Strait of Hormuz could cause European gas prices to more than double. TTF natural gas prices could approach 74 EUR/MWh ($25/mmBtu), 130% above Friday’s levels, if LNG flows through the Strait are fully halted for one month, Goldman Sachs commodity analysts said.
That threshold triggered large natural gas demand responses during the 2022 European energy crisis.
A disruption lasting more than two months would likely lift European natural gas prices above 100 EUR/MWh ($35/mmBtu), the brokerage said.
The Strait of Hormuz carries approximately 80 million tonnes per annum of LNG, 19% of global supply, mainly from Qatar.
Tanker traffic through the waterway appears significantly disrupted after Israel and the United States launched military operations against Iran’s leadership, with Iran responding by firing ballistic missiles and drones at U.S. assets and allies across the region, targeting Israel, Bahrain, Kuwait, Qatar, Oman, the United Arab Emirates, Saudi Arabia and Jordan.
Three oil tankers were reportedly damaged in the region over the weekend, according to the Goldman note.
Crude oil prices embedded an estimated $18 per barrel real-time risk premium at the March 1 market open, based on a 15% weekend gain in WTI retail prices, Goldman said.
That figure corresponds to the 98th percentile of risk premiums since 2005 and is equivalent to the market pricing approximately a one-month full halt in Strait of Hormuz oil flows, allowing for spare pipeline capacity as a partial offset.
Why The Strait of Hormuz is crucial for energy
The Strait is crucial for nearly 20 million barrels per day, or one-fifth of global oil production. Saudi Arabia, Iraq and the UAE together exported 13.1 mb/d via the Strait in 2025, with China as the main destination.
Goldman estimates fair-value oil price impacts ranging from $15 per barrel for a full one-month closure with no offsets, to $4 for a 50% partial closure if all estimated 4 mb/d spare pipeline capacity is used. Iran, which produced around 3.5 mb/d of crude and 0.8 mb/d of condensate in 2025, had exports averaging 1.7 mb/d for crude and condensates last year.
Goldman maintained its baseline Brent/WTI forecast of $60/$56 by 2026 Q4, assuming no sustained supply disruptions.
TTF prices had embedded little-to-no geopolitical risk premium until last Friday, pricing in the lower half of the brokerage’s estimated hard coal-to-gas switching range, modestly below Goldman’s 36 EUR/MWh March 2026 forecast.
In a full one-month Strait closure scenario, Goldman’s fuel-switching models indicate European prices would need to maximize switching into both hard coal and oil products for over three and a half months to offset the tightening, equivalent to roughly 8% of NW European storage capacity.
Spot LNG prices in Asia (JKM) face equivalent upside risks as they are closely tied to TTF to manage Atlantic-basin LNG flows to the Pacific.
U.S. Henry Hub prices face limited upside risk. The U.S. is a large net LNG exporter, and U.S. LNG export facilities typically operate at capacity with little room to increase exports even during a global price spike. Prompt U.S. gas prices below $3/mmBtu and a very negative October 2026-January 2027 spread signal elevated storage congestion risks this year.
Roughly 9% of global gasoil and diesel exports and 18% of global jet fuel exports transited the Strait in 2025. Goldman’s average global dirty crude freight rate has already risen 50% year-to-date, while Very Large Crude Carrier rates from the Arab Gulf to China had tripled over the past month as of Friday’s close.
Global spare production capacity stands at an estimated 3.7 mb/d, concentrated in Saudi Arabia and the UAE, though a sustained Strait closure would physically impede OPEC’s ability to deploy it. OPEC+ announced it would raise required production by 0.21 mb/d in April.
