Goldman Holds TTF Forecast at 41 EUR, Flags Hormuz Risk to 100+ EUR/MWh
52d ago|4 min read2Standard
Fazen Markets Editorial Desk
Collective editorial team · methodology
Fazen Markets Editorial Desk
Collective editorial team · methodology
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Goldman Sachs held its European natural gas price forecasts for TTF, the Continental benchmark, at 41 euros per megawatt-hour for the second half of 2026 and 30 EUR/MWh for 2027. The investment bank announced on 17 June 2026 that the marginal normalization of liquefied natural gas flows is now expected by end-July, a delay from prior expectations. The note explicitly outlined a risk scenario where a sustained blockade of the Strait of Hormuz could drive winter prices above 100 EUR/MWh, more than double its base case, with severe implications for European industry and inflation. Goldman's shares, listed under the ticker GS, traded at $1,090.67 as of 03:12 UTC today, up 2.63% from the prior day's close.
A delayed LNG normalization acts as a signal of lingering physical market tightness, despite recent diplomatic progress. The last significant supply shock occurred in 2022 when the Nord Stream pipeline's closure sent TTF prices to a record 345 EUR/MWh. Current macro conditions are defined by volatile power prices and persistent industrial demand destruction concerns across Europe. The primary catalyst for this reassessment is the ongoing delay in restoring full LNG export capacity from key facilities, following maintenance and geopolitical posturing, which has pushed the market clearing event later into the summer. Secondarily, rising tensions around key maritime chokepoints have increased the optionality value in winter gas contracts.
The signing of a memorandum of understanding between major suppliers earlier this year had initially pointed to a faster resolution. The marginal one-month push in the timeline to end-July indicates logistical and operational hurdles remain. This timing is critical for European storage injection schedules ahead of the 2026/27 winter. Storage levels are currently above the five-year average, but the pace of refill is sensitive to available supply. Any further delay risks tightening the market balance during the high-demand winter period, amplifying price volatility.
Goldman's revised forecast timeline places concrete numbers on market expectations. The core 2H26 forecast of 41 EUR/MWh and the 2027 forecast of 30 EUR/MWh were held steady. The new upside risk scenario quantifies a potential move above 100 EUR/MWh this winter. The bank's long-term forecasts for 2028-29 show a steep descent to 19-16 EUR/MWh, reflecting projected LNG supply additions. For context, the current front-month TTF contract was trading near 38 EUR/MWh at the time of the report's publication.
| Period | Goldman Sachs Forecast (EUR/MWh) | Key Driver |
|---|---|---|
| 2H26 | 41 | Delayed LNG normalization to end-July |
| 2027 | 30 | Gradual supply increase |
| Winter Risk Scenario | >100 | Sustained Hormuz blockade |
| 2028-29 | 19-16 | LNG supply wave overwhelms demand |
This forecast structure creates a steep backwardation in the forward curve, with near-term prices elevated and long-dated prices under significant pressure. The 100+ EUR/MWh winter scenario represents a 144% increase from the 2H26 base case. The long-term forecast of 16 EUR/MWh by 2029 is approximately 60% below current spot levels, indicating a profound bearish structural shift over a three-year horizon.
The immediate second-order effect is increased volatility and hedging activity in winter 2026 gas contracts. Utilities with unhedged exposure, such as RWE or Uniper, face higher potential procurement costs under the risk scenario, pressuring margins. Conversely, integrated oil majors with LNG portfolios, like Shell and TotalEnergies, stand to benefit from wider regional price differentials and strong marketing earnings. European industrial gas consumers in chemicals and fertilizers, including BASF and Yara, remain highly vulnerable to sustained price spikes, which would force further production curtailments.
The primary limitation of the bullish risk case is its dependency on a sustained geopolitical event that is not the central forecast. A swift resolution in the Strait of Hormuz or faster-than-expected LNG ramp-up would invalidate the price spike thesis. Trading positioning data suggests funds have been rebuilding short positions in the front end of the curve, betting on the eventual LNG wave, while industrials and utilities maintain long hedges for winter delivery. Flow is bifurcated, with speculation targeting the winter-spring 2027 spread to express views on the normalization timeline.
Traders will monitor two immediate catalysts: the weekly European gas storage reports from GIE and LNG vessel tracking data into key import terminals like Eemshaven and Isle of Grain. The next major scheduled event is the OPEC+ meeting on 1 July 2026, which could influence global oil and associated gas market sentiment. The actual realization of LNG normalization by end-July is the critical inflexion point for physical balances.
Key price levels to watch on the TTF front-month contract include technical support near 35 EUR/MWh and resistance at the year-to-date high of 45 EUR/MWh. A sustained break above 45 EUR/MWh would signal the market is pricing in a higher probability of the risk scenario. For the long end of the curve, the 2028 contract holding below 20 EUR/MWh will confirm the structural bearish thesis remains intact. Market sentiment will pivot on any official statements from QatarEnergy or Cheniere Energy regarding export facility timelines.
A sustained TTF price above 100 EUR/MWh would trigger a direct pass-through to wholesale power prices, which are often set by the marginal cost of gas-fired generation. This could increase consumer electricity bills by 50-70% compared to current levels, based on 2022 crisis correlations. Governments would likely re-activate price cap mechanisms and subsidies, increasing fiscal burdens and potentially altering long-term energy investment plans. The inflationary impact would also force the European Central Bank to maintain a more restrictive monetary policy stance.
Goldman's 2029 forecast of 16 EUR/MWh is broadly in line with the average TTF price in the five years preceding the 2021 energy crisis, which ranged from 10-18 EUR/MWh. This suggests the bank believes the market will eventually revert to a pre-crisis equilibrium, but only after a massive wave of new LNG supply, primarily from projects in the US and Qatar, enters the market between 2026 and 2028. The forecast implies the current tightness is a multi-year, not permanent, structural shift.
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