London:European natural gas prices have reached their highest level since 2022, with the European gas index (EU Gas) surpassing the £100 ($111.3) per megawatt hour (MWh) mark for the first time in over a year. The index saw a 4.35% increase as of 1530 GMT, rising to £100 per MWh, although it currently hovers just below this level.

According to Anadolu Agency – English, the intensifying conflict in the Middle East has raised significant concerns over winter energy supplies. This is particularly due to the impact on liquefied natural gas (LNG) flows from the Persian Gulf, which previously accounted for nearly a fifth of global supply.

The conflict has driven up prices across various sectors, including crude oil, transportation fuels, natural gas, electricity, and food. Brent oil futures have also increased by 2.2% to $116 per barrel, while heating oil prices have risen by 1.6% to $4.8 per gallon.

Market analysts anticipate that natural gas prices will remain high for at least another year. This expectation persists even if the conflict comes to an end and winter weather remains mild, due to the need for Europe to replenish storage levels that have fallen to record lows.

The rising wholesale natural gas costs are increasingly being passed on to households and industrial consumers, as gas-fired power plants typically set electricity prices during peak demand hours.