European natural gas prices surged on Monday after Qatar halted liquefied natural gas production in response to Iranian drone strikes on major energy sites.
The Dutch Title Transfer Facility benchmark climbed as much as 49.1% to €47.65 per megawatt-hour, rising from about €32 before the attacks.
U.S. natural gas futures advanced roughly 6.7% to $3.05 per million British thermal units as traders reacted to tightening global supply.
Asian spot LNG prices also moved higher as buyers anticipated fewer available cargoes in the weeks ahead.
The escalation follows growing military tensions involving the United States, Israel and Iran across the Middle East.
On March 2, Qatar’s Ministry of Defense confirmed that two Iranian drones struck a water tank at a power facility in Mesaieed Industrial City and an energy installation in Ras Laffan Industrial City.
Officials reported no casualties, yet markets responded swiftly to the disruption risk surrounding key export infrastructure.
State-owned Qatar Energy suspended all LNG production and exports, citing security concerns while assessments of the damage continue.
The company stated it would release further updates once inspections are complete and operational clarity improves.
Qatar ranks as the world’s second-largest LNG exporter, accounting for nearly one fifth of global supply.
The production halt places approximately 81 million tonnes, or around 110 billion cubic metres, of annual exports in question based on 2025 projections.
Replacement volumes remain limited as global markets continue adjusting after Russia’s 2022 invasion of Ukraine.
Shipping movements through the Strait of Hormuz have also slowed, with at least 11 LNG carriers reportedly pausing voyages to avoid the waterway.
Roughly 80 million tonnes of LNG typically transit the Strait each year, much of it originating from Qatar.
European Union gas storage stands near 30.6% capacity, below the seasonal average of 40% and roughly 10 percentage points lower than last year.
Germany’s reserves hover around 20.7%, while France reports storage near 21.1% after a cold January depleted stocks.
Analysts warn that a month-long disruption could lift Dutch TTF prices towards €74 per megawatt-hour, while a longer halt may push levels above €100.