According to the latest data from the Intercontinental London Exchange (ICE), on Wednesday natural gas prices in Western Europe jumped by over 8%.

At the Dutch Title Transfer Facility (TTF) hub, the price of gas futures for July delivery increased to $429.8 per thousand cubic meters, or €37.055 per megawatt-hour in household terms, marking an increase of 8.4%.

The surge occurred as tensions are rising in the Middle East as a result of the escalating conflict between Israel and Gaza. Nearby, Houthi rebels operating out of Yemen have launched attacks on vessels in the Red Sea in support of the Gazans, leading major shipping companies to judge the route, which is vital to many energy suppliers in the crucial region, as unpassable.

At the same time, US forces have carried out airstrikes on Kataib Hezbollah militants in Iraq, as the US Navy has engaged further Houthi attacks on ships sailing off the coast of Yemen, exacerbating concerns that security and stability in the entire region is deteriorating.

Bloomberg ship-tracking data has shown that some ships carrying liquified natural gas (LNG), have begun recently to change their routes for longer voyages which would bypass the Red Sea and the Suez Canal, which would normally be the preferred method of delivering cargo to the Mediterranean Sea and Europe.

Over the past two years, after Europe ceased receiving copious deliveries of Russian pipeline gas and was forced to seek out supplies of LNG, the Suez Canal became the primary shipping artery for transporting the LNG Europe was reliant on, to make up for the lost Russian supplies.

This year the Suez Canal became even more important, as a drought in Panama lowered the Panama canal, dramatically reducing the flow-through of cargo ships there, forcing the Suez Canal to handle the additional cargo of ships delivering cargo to Southeast Asia.

Recently, despite the geopolitical unrest in the world, and the Middle East especially, European gas prices have maintained themselves in a relatively narrow range. As a result of high fuel inventories, and lower demand, which has lessened the anxiety over the current heating season, they are poised to be down by 50% over the year.

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