The monstrous winter storm Fern, which has crossed the United States from coast to coast causing havoc in recent days, has also shaken the European Union. While the 27 face winter with the lowest gas reserves since the war in Ukraine, the cost of this fuel has soared due to a "contagion effect" that has brought to light an uncomfortable reality for Europe: Washington sets the price of its gas... and Europe can only resign itself.
Until late December, Europe was experiencing a mild winter, with surprisingly cheap gas for the heating season. Hovering around 26 euros per megawatt-hour (/MWh) in mid-December. But this January, the situation has taken a turn. The Dutch TTF gas, the European benchmark, has experienced an abrupt rally, rising almost 50% in three weeks and reaching over 40 /MWh. Experts are clear that the explanation is not in the Old Continent.
Neither the low EU reserves (the market discounted this months ago), nor changes in flows from Algeria or Norway, nor what the European thermometers indicate. The real driver of the escalation this time is located 6,000 kilometers away.
The US gas that Europe imports arrives by ship in a liquid state, known as LNG (liquefied natural gas). Before boarding, it must go through liquefaction plants where this change of state occurs. But gas in the US is mainly extracted from rocks where the fuel is trapped, and that process, known as fracking, does not work in extreme cold because the operation literally freezes.
Therefore, these days, the US has resorted more to supplying its own demand with the liquid gas it already had stored in the terminals where it ships to Europe. "It is so cold in the US that the liquefaction terminals are regasifying [changing from liquid to gas] the LNG to sell it in the domestic market," explains José Ignacio García-Lajara, senior analyst of Gas and LNG Markets at WoodMackenzie.
As the EU has cut ties with Russia, Washington has replaced Moscow and has become its main LNG supplier. "The growing influence of the US on gas prices in Europe is structural," explains Javid Abbaszada, analyst at the Macquarie Group, who frames the change in the loss of much of the flexibility that the flow through pipelines provided to the EU. Mainly from Russia. "LNG has become the marginal molecule for Europe." In other words, the one that sets the price.
The phenomenon has been evident, of course, only to those eyes accustomed to following the minute-to-minute results of the markets. "On several days, sessions started with significant drops [in the European TTF price], however, on most of those days, as the trading sessions progressed, prices turned around and sharply shifted upwards," García-Lajara recounts. After analyzing it more closely, he realized that the daily turnaround coincided with the opening of the US market: "As soon as the American desks on the East Coast wake up, the bullish volatility spreads and the European price strongly reverses towards gains."
Abbaszada corroborates this: "When US offices move [for example, due to a sharp change in the Henry Hub, in the weather...], that information is quickly transmitted to European centers." In other words, European brokers take note of the positions of their American colleagues and react accordingly. They assume that if the US LNG economy improves or worsens, the supply to Europe will be affected. "The TTF price adjusts almost immediately," Abbaszada emphasizes. The link, he predicts, "will remain strong as long as Europe structurally depends on LNG and the United States remains the main flexible exporter."
At this point, the reader might wonder 'how does this affect me?' First, the needle on gas in Europe no longer moves essentially due to domestic events, but by global dynamics. Its price no longer depends on whether it is cold in Germany or the Netherlands, or whether the 27 have their reserves fuller or emptier: what matters most is what happens in the global LNG market.
"The TTF has lost the meaning it had years ago as a reflection of the European supply and demand balance and other domestic fundamentals, which makes sense because demand is in Asia and production is in the Middle East and the US. It is a direct consequence of the globalization promoted by LNG as an energy resource. And it is dangerous because it implies that these episodes of volatility will become more frequent and more aggressive," warns García-Lajara.
"The best way to explain it is that the TTF has become more globalized. European fundamentals remain important, but American signals increasingly set the marginal trend," Abbaszada concludes.
The Twenty-Seven bought 57% of the liquefied gas they consumed in 2025 from the US. According to the Institute for Economic and Financial Energy Analysis (IEEFA), if Brussels fulfills the agreement it signed with Donald Trump to minimize tariffs, the percentage will rise to 80% by 2030. It is not difficult to understand why the recent peak in domestic demand in the US can end up harming Europe.
"If US inventories decrease, in summer there will be more pressure to fill them. Europe also has very low inventories and will need its LNG. But if gas is expensive and its domestic market needs it... national supply security will always come first," García-Lajara concludes.