by Eurolng.com Staff
Impact of the Middle East conflict on the European LNG market
Rystad Energy scenario: Europe’s LNG bill up $12 bn despite falling demand
The conflict in the Middle East has disrupted global energy flows. Countries are revising supply routes and turning more often to the spot market to replace lost volumes. Under Rystad Energy’s model, LNG supplies from Qatar and the UAE remain unavailable from March through the end of 2026. In this scenario, global spending on liquefied gas purchases in 2026 rises from $217.8 billion (the pre-conflict forecast) to at least $256.3 billion.
1. Rystad’s numbers: global and European bill
The sharpest cost increase falls on Europe. Even with demand down by 24 million tonnes, the region’s LNG spend rises by at least $12 billion — 18%, to $79 billion. Importers pay more for less volume: spot cargoes are more expensive than long-term contracts, and competition with Asia for available US and other LNG widens the premium.
| Indicator | Pre-conflict | 2026 scenario |
|---|---|---|
| Global LNG spend | $217.8 bn | ≥ $256.3 bn |
| Europe LNG spend | ~ $67 bn* | ≥ $79 bn (+18%) |
| Europe demand (change) | — | −24 Mt |
| Qatar + UAE supply | in forecast | unavailable Mar–end 2026 |
* Implied from +$12 bn to $79 bn. Source: Rystad Energy (2026 estimates).
2. Why Europe pays more for less volume
Qatari and UAE LNG shortfall. The Strait of Hormuz and infrastructure damage (including around Ras Laffan) have removed a large share of supply from the market. Europe and Asia compete for remaining spot cargoes from the US, Africa and Australia.
Spot instead of contracts. Lost long-term volumes are replaced on the spot market. Spot prices in 2026 are well above pre-conflict levels; the premium for flexibility and urgency falls on importers.
Low storage and winter demand. European underground storage enters the season well below the levels of recent years. That increases willingness to pay a premium for prompt cargoes and supports elevated TTF levels.
3. Implications for the European market and ssLNG
High TTF. The benchmark stays in a zone of elevated levels and volatility. ssLNG price formulas (TTF + premium + logistics) pass this level straight through to end users — industry, road transport and bunkering.
Competition for slots and tankers. With limited spot supply, physical access from north-western and Baltic terminals (Gate, Klaipeda, Świnoujście and others) becomes more valuable. “Virtual pipeline” logistics become a distinct price factor.
Demand pressure. Europe’s demand cut of 24 million tonnes in the Rystad scenario reflects high prices and switching by some consumers. For the ssLNG segment this means tighter customer selection and growing interest in Bio-LNG as a way to reduce carbon and regulatory risk.
4. What next
Until Qatari and UAE supplies recover, the European LNG market remains dependent on the spot market and US exports. The ban on Russian LNG from 1 January 2027 will further reduce long-term contract supply. Together these factors support the risk of high prices through winter 2026/27 and make source diversification and flexible price formulas critical for buyers — both large-scale and small-scale.
For ssLNG traders and consumers the priorities remain: access to Baltic and north-west European terminals, transparent TTF linkage, full-tanker deliveries and, where possible, certified Bio-LNG.
Conclusion
Under the Rystad Energy scenario, the Middle East conflict lifts global LNG spending to at least $256.3 billion in 2026. Europe pays at least $12 billion more (to $79 billion) despite demand falling by 24 million tonnes. Spot markets, competition with Asia and low storage keep TTF elevated and feed directly into the cost of small-scale LNG for industry and transport.
Source: Rystad Energy (2026 LNG cost estimates, Qatar and UAE supply unavailability scenario); market data on TTF and EU storage, October 2026.