European natural gas prices have surged to their highest level in four years amid the Iran war and the EU’s continued push to phase out Russian energy, according to data from online aggregator Trading Economics.
On Monday, wholesale prices briefly surpassed €97 ($108) per megawatt-hour, reaching levels not seen since December 2022. The increase came as gas storage facilities in the EU were just 74.62% full as of October 25, well below seasonal averages.
Liquefied natural gas (LNG) shipments through the Strait of Hormuz, which accounted for around a fifth of global LNG trade before the start of the US-Israeli war against Iran earlier this year, remained around 80% below pre-conflict levels.
Some EU countries have already begun drawing on stored gas as temperatures drop. Trading Economics forecasts that European gas prices will reach €98.20 per megawatt-hour by the end of the fourth quarter of 2026.
In the UK, the month-ahead gas contract rose by 4% to its highest level since December 2022, according to The Guardian. Brent crude, which climbed to $117 per barrel last week, has since eased slightly but remains at around $115.
British households could face a 27% increase in energy bills in January, pushing the average annual dual-fuel bill to nearly £2,200 ($2,940), according to a forecast by energy supplier EDF. An earlier forecast by Cornwall Insight projected a 16% increase to £2,000.
In August, The Guardian reported mounting concerns in the EU over low gas storage levels and soaring prices ahead of winter. In September, EU Energy Commissioner Dan Jorgensen warned that the bloc faces its worst energy crisis since 2022.
In mid-October, German media reported that Berlin plans to make households and businesses pay for a national emergency gas reserve costing more than €3 billion over ten years. The government-controlled stockpile would be reserved for emergencies, including sabotage and infrastructure failures, rather than being used to lower gas prices.
The opposition Alternative for Germany (AfD) party called for energy ties with Russia to be restored, following US President Donald Trump’s example. On October 13, AfD co-leader Alice Weidel said Germany should seek its own diesel deal with Russia, praising Trump’s agreement with the country as a pragmatic approach.
Following the EU’s sweeping sanctions on Russia in 2022, the bloc experienced one of its worst energy crises in decades. Gas prices soared above €300 per megawatt-hour, driving up costs for industries and households and contributing to surging inflation.
The EU has continued its efforts to phase out Russian energy. While Russia accounted for around 45% of EU gas imports in 2021, the share fell to around 12% by 2025.
Moscow has described the EU’s efforts to sever energy ties with Russia as “suicidal.” Last week, Russian presidential investment envoy Kirill Dmitriev argued that the bloc would eventually have to restore ties because “cooperation with Russia economically will be inevitable.”
Dmitriev blamed the EU’s problems, including high energy costs, on its leaders, saying they refuse to acknowledge and correct their mistakes.