Southeast Europe is not the world’s largest LNG market, but it remains exposed to disruptions in global LNG flows. Around 20% of global LNG trade passes through the Strait of Hormuz, and more than 85% of those volumes normally go to Asian markets. If those flows are disrupted, the impact would be transmitted to SEE through gas prices, LNG competition and power-market marginal costs.
Strait of Hormuz exposure and LNG cargo competition
The immediate supply concern highlighted in the report relates to Qatari LNG. Qatar is a major supplier to Asia, and any disruption would require Asian buyers to secure alternative cargoes. Europe’s direct dependence on Qatari LNG has declined to around 8% of total imports, but the report says this does not remove risk because LNG is traded globally.
In a scenario where Asian buyers bid more aggressively for available cargoes, Europe would need to pay more to attract supply. The report links this competition to higher European gas benchmarks needed to secure LNG volumes. It states that European benchmark gas prices may need to rise 40–50% from current levels if disruptions to Qatari exports persist.
TTF pricing implications and limits on US supply
During Week 23, TTF averaged €48.56/MWh, while the one-month forward was near €49.335/MWh. The report notes that a 40–50% increase from these levels would be material for power pricing. It also describes constraints on alternative supply from the United States.
US LNG is described as unable to quickly fill any gap because export facilities were operating at approximately 94% utilisation. With limited spare capacity, the adjustment mechanism would be primarily through price rather than immediate additional volumes. The result would be increased competition for available cargoes, pushing TTF higher.
LNG infrastructure in Italy, Greece and Croatia
For SEE, the report describes multiple channels connecting global LNG prices to regional gas balances. It points to LNG import infrastructure in Italy, Greece and Croatia as relevant for regional supply conditions. During Week 23, LNG inflows to Greece recovered to 860.32 GWh, Italy received 2,836.03 GWh, and Croatia received 645.30 GWh.
The report characterises these terminals as part of the region’s supply-security architecture rather than peripheral assets. It links higher LNG prices to changes in gas-fired power generation costs across SEE. It also highlights that the effect is most relevant during evening peaks, low-wind periods and high-demand weeks.
Gas-to-power transmission during peak demand
In Week 23, Turkish gas-fired power generation jumped 278.1%, while thermal generation across SEE rose 24.5%. The report states that if gas prices increase sharply, the cost of this balancing response would rise accordingly. It also connects higher power prices to industrial electricity buyers through marginal pricing set by gas-fired units.
The report says even firms without direct gas exposure can face higher electricity costs when gas-fired generation sets marginal prices. It lists steel, aluminium, cement, fertiliser, chemicals and data centres as sectors that would feel the effect through electricity costs, hedging needs and procurement risk.
Differing regional exposure across interconnected markets
The report indicates impacts would not be uniform across all systems in SEE. Markets with stronger hydro or lignite availability may experience less immediate exposure than more gas-dependent systems. However, it says SEE markets are interconnected.
As a result, higher prices in Italy, Greece or Hungary can influence flows and spreads across the Balkans. The report frames the overall linkage as extending beyond Russian pipeline routes or local storage toward global maritime chokepoints affecting LNG cargo availability between Europe and Asia.
