Goldman Sachs has revised its short-term European natural gas price forecasts upward, citing delays in the resumption of liquefied natural gas (LNG) exports from the Persian Gulf due to ongoing tensions in the Middle East. Goldman Sachs analyst Samantha Dart now expects LNG exports from the region to return to normal levels in October, rather than July as previously forecast.
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The delay is linked to disruptions in shipping through the Strait of Hormuz — a critical maritime chokepoint through which approximately 20% of global oil consumption and 20% of global LNG exports flow. According to Goldman Sachs, the delay will reduce global LNG supply during the summer period by approximately 16 million tonnes per year, or around 4%, which will in turn constrain natural gas inventories across northwestern Europe.
The American bank now estimates that European storage facilities will be only 67% full by the end of October, when the winter heating season begins — down from its previous forecast of 74%. By the end of winter, in late March, storage levels are expected to have dropped to just 28%, assuming temperatures remain in line with seasonal norms.
Goldman Sachs revises TTF forecasts higher
Against this backdrop, Goldman Sachs has revised its price outlook for the Dutch TTF natural gas contract — the benchmark for the European market — sharply upward. The bank’s new estimates project an average price of €60 per megawatt-hour for the remainder of the third quarter of 2026 and €53 per megawatt-hour for the fourth quarter, compared to previous forecasts of €41 and €40 respectively.
For the full year 2027, Goldman Sachs has also raised its forecast to €31 per megawatt-hour, up from a previous estimate of €30.
The bank notes that risks to its short-term forecasts remain skewed to the upside and continues to recommend that large natural gas consumers hedge their exposure against the possibility of another sharp price spike this winter.
In a worst-case scenario — where energy exports from the Middle East recover only gradually throughout 2027 — Goldman Sachs estimates that TTF prices would need to exceed €100 per megawatt-hour in order to sufficiently suppress Asian LNG demand.
Conversely, if flows through the Strait of Hormuz are restored more quickly than expected, prices could retreat back toward €40 per megawatt-hour — the level considered the threshold at which gas-fired power generation becomes competitive with coal once again.
Over the longer term, Goldman Sachs maintained its view that natural gas prices will trend lower, forecasting an average price of €19 per megawatt-hour in 2028 and €16 per megawatt-hour in 2029. However, the bank stresses that this outlook is contingent on the full restoration of shipping through the Strait of Hormuz.
