Goldman Sachs: European Gas Prices Could Surge 130% If Strait of Hormuz Closes

Goldman Sachs warns that European gas prices could rise by up to 130% if the Strait of Hormuz remains closed for a month. This forecast comes as European gas futures have already jumped by 50%, reaching €47 per megawatt-hour, due to disruptions caused by the Middle East conflict on liquefied natural gas (LNG) flows.

QatarEnergy has suspended LNG production at its Ras Laffan and Mesaieed facilities, which account for approximately 20% of global LNG supply, following a drone attack. Additionally, LNG tanker operators have halted transits through the Strait of Hormuz, further restricting flows.

The suspension of exports from Qatar threatens approximately 15% of the European Union's LNG imports, intensifying competition for cargoes and driving up prices. Risks are exacerbated by low levels of stored natural gas in the EU, which are below 31%.

The combined pressure from production losses, shipping restrictions, and lower inventories creates a volatile environment, with the European market facing increased energy risk ahead of winter.