Prices for crude oil and natural gas in the global market had begun to gradually decline, but the renewed flare-up of military operations in the Gulf has halted this process. Unlike oil, the price of natural gas has not experienced a rapid decline.
According to sea-news.az that the price of natural gas at the Dutch TTF hub is currently trading at 44 euros per gigawatt-hour (GWh) (approximately $535.5 per 1,000 cubic meters). Unlike the winter season, the price has dropped by only 10 percent.
A report by the Center on Global Energy Policy at Columbia University (USA) states that gas storage facilities in European countries are not yet full. The exceptionally hot summer has increased the demand for electricity. Consequently, the volume of gas used for electricity generation has risen, preventing prices from falling. On the other hand, although transit through the Strait of Hormuz has opened, Qatar is only able to export one tanker of liquefied natural gas (LNG) per day, compared to three previously. Qatar’s LNG gas infrastructure sustained serious damage during the war. Restoration work is currently ongoing, which is slowing down the filling of storage facilities.
According to the center’s analysis, as of today, France has been able to fill 50 percent of its gas storage facilities, Germany 42.3 percent, the Netherlands 26.7 percent, and Belgium 23.7 percent. If these facilities are not filled by October, a crisis could occur during the upcoming winter season, which may be accompanied by further price increases.
The resumption of military operations between Iran and the U.S. on July 8 has further exacerbated the situation. As a result, the transit of ships through the Strait of Hormuz has been closed again, creating problems for market supplies. This situation makes price increases inevitable.
In an interview with the Financial Times, Qatari Prime Minister Mohammed bin Abdulrahman Al Thani stated that Qatar could restore its infrastructure and increase LNG production within three weeks. However, the tense situation in the Gulf is complicating supplies. In his view, the primary problem is the destabilization of the Gulf region.
