UK natural gas prices surge as global supply tightens, driving the market upward

⑴ UK natural gas prices are approaching 222 pence per thermal unit, reaching a new stage high. Disruption in Middle Eastern LNG supply has pushed prices to nearly three times the level at the beginning of the year. ⑵ North Sea gas sources account for about 30% of the UK's winter gas demand, with production expected to decline by 4%. As a hedge, LNG imports are expected to increase by 4%, and Norwegian pipeline gas deliveries will see a slight rise. ⑶ UK pipeline operators state that even under extreme scenarios, domestic gas supply capacity can still be guaranteed, but intensifying global competition for LNG cargoes poses a risk of further price increases. ⑷ The newly approved Jackdaw gas field is expected to provide supply relief and could start delivering natural gas to the UK by the end of this month.