Gas Prices Surge Amidst Middle East Conflict and Supply Disruptions

Benchmark European wholesale gas prices have surged due to the ongoing US-Iran conflict and disruptions in global energy supplies. The decision to appoint Mojtaba Khamenei as Iran's new supreme leader indicates a prolonged conflict, affecting oil prices and LNG demand and supply across Europe.

LONDON, March 9 - European wholesale gas prices reached their highest level in over three years on Monday, driven by rising oil prices and ongoing tensions in the Middle East, particularly the US-Iran conflict. Shipping disruptions around the Strait of Hormuz have further exacerbated the situation.

The appointment of Mojtaba Khamenei as Iran's new supreme leader suggests no quick resolution to the conflict, prompting a significant increase in oil prices, which soared to over $119 per barrel. The Dutch TTF hub contract, a key European price benchmark, also saw a sharp rise, reflecting increased market volatility.

In response to colder weather forecasts in North-West Europe, heating demand is expected to rise. Analyst Ulrich Weber noted that Middle East developments remain central to market movements, with Societe Generale highlighting reduced LNG supply from key regions exacerbating the existing supply-demand imbalance.

(With inputs from agencies.)