Goldman lifts TTF forecasts to €60 as Gulf supply risks mount

Goldman Sachs has sharply raised its European gas price forecasts for the second half of the year. The investment bank now expects the Dutch TTF benchmark to average €60 per megawatt hour in the third quarter and €53/MWh in the fourth. This represents a steep upgrade from the bank's previous projections of €41 and €40/MWh, respectively.

The revised outlook follows a pushback in the timeline for normalised Gulf LNG exports. Goldman Sachs now expects these critical flows to recover by October, a significant three-month delay from its prior July estimate.

Supply fears escalated on Monday after Yemen's Iran-aligned Houthis announced a naval blockade on Saudi Arabia. This declaration significantly raises the threat to global energy supplies and broader maritime trade beyond the Gulf. It also opens a potential new front against the United States in its war with Iran.

The physical market is already reflecting this newly priced risk. The benchmark Dutch front-month contract at the TTF hub was trading around €59/MWh at 0755 GMT on Tuesday. This came just after the contract hit €60.66 on Monday, marking its highest intraday level in four months.

For European industrial consumers and utilities, the sharp upward revision complicates hedging strategies heading into the colder months. Previous expectations of significant price relief, pegged at €41/MWh for the third quarter, have been entirely upended by the ongoing disruption to Middle Eastern supply routes.

"The tightening of European gas balances and Europe's increased vulnerability to a cold shock in the winter raise the risk that TTF might need to rise to €65/MWh," Goldman Sachs said in a note. This explicit warning leaves prices highly sensitive to any further escalation in the Middle East, with investors now forced to weigh weather forecasts against naval developments.