UK Gas Jumps 40% as Qatar Halts LNG Production

UK natural gas futures jumped more than 40% on Monday to 115 pence per therm, reaching their highest level since February 2025, after QatarEnergy suspended LNG production at the Ras Laffan and Mesaieed industrial cities. The shutdown followed reports from Qatar’s Defense Ministry that two Iranian drones struck energy facilities earlier in the day. The escalation came after the US carried out strikes on Iranian territory, prompting Tehran to retaliate with attacks on regional allies. Investors also monitored disruptions to traffic through the Strait of Hormuz, a vital corridor for global energy supplies. The strait handles roughly one-fifth of global LNG trade, including key exports from Qatar, which accounts for about 15% of Europe’s LNG imports. With domestic gas storage less than 30% full at the end of February, the UK market remains highly vulnerable to external supply shocks.

UK Gas increased to 112.41 GBp/thm, the highest since February 2025. Over the past 4 weeks, Natural Gas UK gained 41.18%, and in the last 12 months, it increased 4.81%.

Natural gas futures in the UK surged toby over 20% on toward the 100 pence per therm mark on Monday, tracking similar developments in global energy markets after the eruption of war in Iran threatened oil and gas supplies from the key region. US forces struck Iranian territory in an attempt to force a regime change, prompting Tehran to retaliate by attacking allies across the Middle East. Although strikes on natural gas infrastructure, including LNG export plants, have not been reported, LNG operators and shipping companies suspended key flows through the Strait of Hormuz. The strait sees flows that account for one fifth of global LNG trade, including key exports from Qatar, which supplies about 15% of Europe's LNG imports. Consequently, lower gas supplies from the region increase bidding competition by Europe for Norwegian gas flows to the UK. Domestic gas inventories were less than 30% full as of the end of February, increasing the vulnerability to external supply shocks.