Stories
European Gas Prices Projected to Surge 30 Percent in Q4 2026
- •Bank of America reports that European gas prices could jump about 30 percent above current expectations in the fourth quarter of 2026.
- •The surge is driven by winter heating demand and gas storage levels dropping to their lowest in over a decade at around 73 percent.
- •Prices are expected to average around 250 pence per therm, or 100 euros per megawatt-hour, between October and December 2026.
- •Bank of America favors exploration and production companies sensitive to gas prices, anticipating stronger cash flows and earnings.
- •Brent crude oil prices are projected to average USD 100 per barrel in the fourth quarter of 2026.
Key Questions Answered
Bank of America expects European gas prices to average around 250 pence per therm, or 100 euros per megawatt-hour, between October and December 2026, which represents an increase of nearly 60 percent from the previous quarter and sits roughly 30 percent above current forward curve prices.
European gas storage levels stood at approximately 73 per cent in early October, down from 83 per cent the previous year, driven by factors such as disruptions in Middle Eastern shipments through the Strait of Hormuz, reliance on global liquefied natural gas, and unraveled summer-winter price spreads that hampered commercial storage injections.
Rising gas prices are expected to support earnings and stronger cash flows for European exploration and production companies, as these firms are more sensitive to changes in gas prices than oil prices.
