The impact of the increase in the price of natural gas at the TTF hub in Amsterdam is temporarily cushioned in Romania by caps and domestic production, but if tensions persist, pressure on industry, inflation and the economy will become inevitable, believes Dumitru Chisăliță, president of the Smart Energy Association.

“The 40% explosion of the TTF (European reference benchmark for natural gas traded on the stock exchange) is not the result of a single event. It is the product of a fragile, structurally tense market, hit by a major geopolitical shock. European gas remains: sensitive to conflict, dependent on LNG, vulnerable to logistical blockages, prone to emotional reactions. For Romania, the impact is temporarily cushioned by caps and domestic production, but if tensions persist, pressure on industry, inflation and the economy will become inevitable. Energy is no longer just a commodity. It is an indicator of global geopolitical stability. And the TTF is the thermometer of these fragilities”, explained Chisăliță, in an analysis sent to Agerpres on Tuesday.

A drone attack attributed to Iran hit major liquefied natural gas (LNG) facilities in Qatar (specifically the Ras Laffan complex). Qatar, being one of the world’s main LNG exporters, stopped liquefied gas production after this attack. This shutdown has eliminated a significant portion of the global supply of LNG – a critical resource for Europe, which imports LNG to make up for the shortage of Russian gas. This sudden reduction in supply has fueled a sharp jump in TTF prices (by 40%).

In addition, geopolitical instability has also affected maritime traffic in the Strait of Hormuz, a key point through which a significant portion of global energy exports (oil and LNG) pass.

“Even before this current crisis, gas stocks in Europe were relatively low and the market was tense due to seasonal demand, transportation costs and the need to replenish stocks after last winter. Thus, a supply shock (even temporary) generates a disproportionate price reaction. The TTF price reflects the global dynamics of supply and demand for natural gas. The market remains sensitive to factors: geopolitical (wars, tensions in the Middle East), logistical (maritime transport, regasification capacities), stocks and seasonal demand, and can fluctuate significantly in short periods when major disruptions occur”, emphasizes the cited source.

The President of the Smart Energy Association thus believes that the 40% increase in the TTF is not caused by a single internal factor, but by a combination of an unexpected disruption in global supply and market emotions (people expect limited supply), which increases the pressure on prices.

Dumitru Chisăliță also explained why the price of European gas traded at the Title Transfer Facility (TTF) reacts more violently than that of the benchmark Brent crude oil, showing that the reason is related to the market structure, not just geopolitics.

Thus, while the oil market is much larger and more liquid, with a global production of 105 million barrels/day, diversified flows, strategic stocks in many countries and high redirection capacity, gas is more regional and more rigid.

“Gas (especially in Europe) has: fixed infrastructure (pipelines, LNG terminals), limited fast transport capacity, limited gas storage facilities. If 10% of the supply is blocked, this lack in the market cannot be immediately compensated for and the market reacts disproportionately. Gas does not yet have the global flexibility that oil has”, commented the AEI president.

In addition, in the case of US crude oil, China and the EU have enormous strategic reserves and can release millions of barrels/day. Gas is stored only seasonally, with limited capacity. If the volume of gas in storage is reduced, panic sets in quickly. This makes gas traders react anticipatory to the lack of gas and volatility is much higher than for crude, he added.

“Gas demand is less flexible. In the case of gasoline, consumers can reduce the use of cars and thus demand can be reduced. In the case of gas, you cannot stop heating the city and the power plants have to operate. This makes the market more “nervous”. Europe is structurally more vulnerable to gas. After the reduction of Russian imports, Europe depends a lot on LNG, being in competition with Asia for the same cargoes. This makes any risk in the Middle East hit directly in the FTT. Oil, on the other hand, is already globalized and diversified,” the analysis also shows.

At the same time, the TTF market is smaller, less liquid than oil and more influenced by speculative flows, and a relatively small volume of capital can move the price more strongly than on Brent.

“That is why we see price increases of more than 30-50% for gas, while oil only goes up 5-10% in the same period,” Chisăliță pointed out.

For the future, he believes that the evolution of the price of natural gas on the TTF hub is very uncertain, but in the scenario of persistent geopolitical tensions (total and continuous blockage of the Strait of Hormuz affecting almost 20% of global LNG trade), TTF prices could rise significantly above current levels, possibly up to 90 euros/MWh in extreme supply disruption scenarios.

“This scenario reflects a market reaction to supply risk, not a “safe” prediction,” the quoted source states.

In the normalization/better supply scenario, as LNG stocks and supply remain relatively solid and demand does not explode, the TTF price could oscillate around moderate values, possibly below 40-50 euros/MWh, especially if there is geopolitical peace and good storage levels.

In the medium term (2026-2027), the analyst believes that the European natural gas price will be influenced by structural factors such as source diversification (more LNG from the US/Other regions and demand) and the EU’s seasonal energy policy.

In Romania, for the population, the impact of the gas price increase is zero as long as gas demand can be covered by supply, because prices are capped by the government scheme.

For industry and the economy, given that natural gas sales prices to industrial consumers are often contractually linked to the TTF price, its increase also leads to an increase in the price to industrial consumers. A price of 40 euros/MWh on the TTF can lead to a price increase for non-household consumers by about 20% compared to 2025, but a price of 60 euros/MWh on the TTF can lead to a price increase for non-household consumers by about 40% compared to 2025.

“Romania produces part of its electricity on gas. If gas becomes more expensive, the cost of electricity on the free market increases. Even if we have hydro and nuclear, gas often sets the marginal price in the market. The short paradox is that there is also a positive effect in the short term: the state collects higher taxes and dividends. But if the economy slows down due to expensive energy, the net effect can become negative”, Dumitru Chisăliță also mentioned.