Europe’s gas prices are surging. Who will be the first to pay more?

Gas and electricity bills could increase in Europe this winter if wholesale prices remain elevated long enough to feed through to consumers.

The benchmark European wholesale natural gas price, the Dutch front-month TTF, was trading at over €66 per megawatt-hour (MWh) later on Tuesday, down from above €68 earlier in the session. This compares with around €29/MWh at the beginning of the year.

The rally has been fuelled by growing investor concerns that the Strait of Hormuz could remain closed into the winter.

This comes at a time when the EU's gas-storage levels remain historically low ahead of the heating season.

EU gas storage was 62.99% full at the end of the gas day on 24 August, according to data from Gas Infrastructure Europe.

"Europe's gas stores are unusually low for the time of year," Natasha Fielding, editorial manager for gas, LNG, coal and biomass at Argus Media, told Euronews Business. She added that this level was far below the five-year average of 79%.

"The only other time in the last 15 years that stocks were close to as low was in 2021, ahead of the last major gas crisis," Fielding said.

Among the larger European markets with the lowest storage levels, Germany's stores were only 51% full, while those in the Netherlands stood at 44.3%.

Oxford Economics pointed out in a report published on 13 August — before the latest icrease in gas prices — that EU gas consumption is around 15%-20% lower than in 2021.

It said the EU can operate with lower storage levels, although that would mean relying on more winter LNG imports. And that could leave the EU more exposed to competition with Asian buyers for available cargoes.

The competition is already intensified due to the effective closure of the Strait of Hormuz, disrupting a route that normally carries almost one-fifth of global LNG trade.

In a potential EU-Asia bidding war, wholesale prices could climb further.

At current levels, prices "will not be enough for Europe to manage storage through winter," Goldman Sachs analysts Samantha Dart and Laura Cyr wrote in a note cited by Bloomberg.

"In a scenario where Middle East energy exports normalise only gradually through 2027, we estimate that December 2026 TTF would likely need to move above €100/MWh," they said. That is 110% above Goldman's €50/MWh base case, they added.

Oxford Economics said the EU might be forced to suspend parts of its ban on Russian gas imports if supplies tightened further. According to the latest European Commission calculation, Russia's share of combined pipeline and LNG imports was around 12.5% in 2025.