Goldman Sachs: European Natural Gas May Need to Rise to €100/MWh to Complete Winter Restocking
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Goldman Sachs warns that if Middle East energy export disruptions persist into 2027, Europe's benchmark TTF December contract may need to breach €100/MWh — double its base case — for the continent to refill storage before winter, pricing in a real energy-security risk.
Where does the €100 figure come from?
Goldman's base case prices TTF at €50/MWh, assuming Middle East exports normalize.
If the US–Iran conflict keeps Strait of Hormuz energy flows depressed through 2027, Europe must bid a +110% premium to secure scarce LNG (liquefied natural gas — natural gas cooled into liquid form and shipped by tanker) cargoes against Asian competition.
This means → €100 is not a tail-risk extreme; it is Goldman's price for a "gradual Middle East recovery" scenario — a middle case.
How tight is European storage right now?
Goldman estimates northwest European gas inventories will reach only 51% by month-end — 3.4 percentage points below its base case.
Storage is normally filled over summer, but this year's pace lags significantly — Asian buyers are competing fiercely for the same LNG cargoes.
In plain terms = Europe didn't stockpile enough gas over summer; if winter turns cold, supply may fall short, so prices must rise high enough to either curb demand or attract new supply.
Is the current €65 price enough?
The TTF front-month contract last week hit a five-month high of €65/MWh, but Goldman states explicitly that this level is "insufficient to support Europe through winter safely."
This means → The market is already rallying, yet Goldman's model implies at least another 50% upside is needed to trigger adequate supply–demand rebalancing.
Could anything make this less severe?
Rystad Energy notes that a "super" El Niño pushing winter temperatures at least 2°C above the historical mean would cut gas demand, partially offsetting low inventories.
Goldman's latest forecast, however, assumes winter temperatures near the historical average — a warm winter is a potential upside, but it is not priced into the base case.
This reflects Goldman choosing a conservative assumption: plan for normal weather, price the risk fully.
What is the biggest wildcard?
The key variable is the Middle East: President Trump has announced what he calls an "economic D-Day" sanctions package against Iran, and the geopolitical outlook remains highly uncertain.
In plain terms = whether gas ultimately hits €100 or stalls at €65 depends on whether tankers can transit the Strait of Hormuz normally — and that question is decided by politics, not markets.
Content is for reference only, not financial advice.