BAKU, Azerbaijan, April 21. Natural gas prices jumped sharply in the first quarter of 2025 across all major markets, driven by tight supply conditions, cold weather, and geopolitical tensions, according to the International Energy Agency (IEA), Trend reports.
In Europe, Title Transfer Facility (TTF) spot prices averaged $14.5 per million British thermal units (MBtu), up more than 65% year-on-year—the highest quarterly level since early 2023. The price surge was supported by a 9% increase in demand, declining pipeline gas imports from Russia and Norway, and rapidly falling storage levels. European prices outpaced Asian benchmarks, with TTF trading around $0.4/MBtu above Platts JKM, drawing more LNG into Europe - up by more than 20% compared to a year earlier.
In Asia, spot LNG prices also rose over 50% year-on-year to average above $14/MBtu in Q1 2025. Limited LNG supply growth and fierce competition from Europe contributed to the price spike, while buyers in Asia increasingly turned to long-term oil-indexed contracts priced between USD 11-13/MBtu.
In the United States, Henry Hub prices nearly doubled from a year earlier, averaging just over $4/MBtu - the highest since late 2022. Cold snaps and weaker production drove up prices, with a polar vortex in January sending day-ahead prices at the Transco Zone 6-NY hub to nearly USD 43/MBtu. New England also saw elevated prices, averaging $14.5/MBtu in the first two months of the year.
Looking ahead, forward curves suggest gas prices will remain elevated through 2025. European and Asian benchmarks are both expected to average just over $12.5/MBtu, while Henry Hub prices in the U.S. are projected to climb by over 75% to nearly $4/MBtu. Stronger demand, limited supply growth, and tight global LNG competition are likely to keep markets on edge.
