Middle East Conflicts Disrupt Global Natural Gas Markets, Causing Price Volatility

According to the International Energy Agency's (IEA) '2026 Third Quarter Gas Market Report', the global natural gas market balances, which had eased gradually since the second half of last year, were disrupted again by the war in the Middle East that began at the end of February and the closure of the Strait of Hormuz. The interruption in the strait, through which approximately 20% of global LNG supply passes, caused sharp price fluctuations in international markets. The report stated that in March, spot natural gas prices reached their highest monthly averages since the 2022-2023 energy crisis. Accordingly, Europe's benchmark price, TTF, increased by 32% in the second quarter compared to the same period last year, reaching an average of $16 per million British thermal units (MBtu). The Asian spot LNG price also increased by 45% during the same period, reaching $17.5/MBtu. Although the upward pressure on prices eased slightly after the temporary agreement between the US and Iran in mid-June, LNG transportation through the Strait of Hormuz remains well below pre-conflict levels. According to the report, the loss of supply from the Middle East was partially offset by increased production in other regions. During the March-June period, LNG loadings from Qatar and the United Arab Emirates decreased by 35 billion cubic meters annually, while new projects and capacity increases in existing facilities in North America and Africa compensated for approximately three-quarters of this loss. Due to high spot prices and supply concerns, a 0.5% (approximately 20 billion cubic meters) decline in global gas demand is expected this year. This would be the third annual decline in demand in this decade, following 2020 and 2022. The report also noted that the shift from natural gas to coal in the electricity sector is gaining momentum, particularly in Asia and Europe, due to high natural gas prices. Fuel switching policies and administrative measures implemented in countries such as China, Japan, and India are playing a significant role in balancing the global natural gas market. The report drew attention to the medium-term effects of the conflicts, predicting that cumulative LNG supply losses due to damage at the world's largest LNG liquefaction plant, Ras Laffan in Qatar, could reach 140 billion cubic meters between 2026 and 2030. It is clear that these developments must be closely monitored for the Future and Stability of Energy Markets and that long-term strategies need to be revised accordingly.