Dutch TTF natural gas futures rose from the low €30s per megawatt-hour to over €60/MWh on Tuesday — nearly doubling in under a week. The surge follows Iran's drone strikes on Qatar's Ras Laffan LNG complex, which shut 20% of global LNG production, and the near-closure of the strait of Hormuz, where vessel traffic has fallen 80% below normal.
This is Europe's second energy shock in four years, and in structural terms it is worse than the first. The 2022 Russian gas cutoff disrupted pipeline supply and sent TTF to €340/MWh in August of that year. European governments responded by spending billions to replace Russian molecules with Liquefied Natural Gas — principally from Qatar. That replacement supply is now under direct military fire. Iran has degraded all three pillars of The Gulf's energy export architecture: production at Ras Laffan, refining at Saudi Aramco's Ras Tanura facility, and transit through Hormuz. The contingency plan has become the casualty.
EU gas storage stands at 30%, below last year's level at the same date. Bloomberg assessed that Europe can absorb current prices if the conflict ends within one month. Beyond that, the continent faces a genuine supply crisis heading into next winter's restocking season — the April-to-October period when utilities must refill underground storage to survive peak demand. The euro and yen fell against the dollar as currency markets priced the energy exposure of import-dependent economies against a United States that produces most of its own oil and gas. UK economists warned of depressed growth, higher inflation, and increased public debt if prices hold.
The disruption now operates on an institutional timeline independent of military or diplomatic developments. Three major Protection & Indemnity clubs — American Steamship Owners Mutual, London P&I Club, and Skuld — cancelled War risk coverage for the Persian Gulf and Gulf of Oman. Without P&I insurance, vessels cannot be financed or commercially operated by any major shipping line. Reinstatement requires full syndicated risk reassessment — a process that typically takes weeks after hostilities cease. Even a ceasefire tomorrow would not restart gas flows for weeks. European households and industries, still absorbing the cost of the 2022 shock through higher bills and industrial demand destruction, face a second round driven by the same underlying vulnerability: dependence on energy that transits contested waterways, carried in ships that require functioning insurance markets to sail.
