HK Stock Concept Tracking | European Natural Gas Faces Heavy Pressure on Both Supply and Demand Sides; Restocking Pressure May Lift the Central Price Level of Gas (With Concept Stocks)

Title context: HK Stock Concept Tracking | European Natural Gas Faces Heavy Pressure on Both Supply and Demand Sides; Restocking Pressure May Lift the Central Price Level of Gas (With Concept Stocks) Text: Driven by escalating supply disruptions from Middle East military conflicts and the urgent need for inventory replenishment ahead of the winter heating season, European natural gas prices have continued to rise, nearly tripling year-to-date. If global supply remains tight, Europe will have to compete even more fiercely for supply during the heating season. Orient released a research report stating that against the backdrop of a restructuring global order and geopolitical conflicts, the central price level of global energy is shifting upward, and natural gas prices are expected to gradually enter a new upward cycle. Recently, after a brief period of relative calm, tensions in the Middle East have escalated again. Mutual strikes between Saudi Arabia and Yemeni armed forces have raised concerns about disruptions to the Red Sea shipping route, sending natural gas prices in both Europe and Asia soaring. Data from the London Intercontinental Exchange (ICE) showed that during Monday's trading session, European natural gas prices broke through USD 1,000 per thousand cubic meters for the first time since December 2022. The October natural gas futures price at the Dutch TTF hub rose to approximately USD 1,004 per thousand cubic meters, equivalent to EUR 84.07 per megawatt-hour. Meanwhile, spot natural gas prices at major European trading hubs had already surpassed USD 1,000 per thousand cubic meters last week. Among them, the day-ahead spot price at the TTF hub reached USD 1,005, or EUR 83.685 per megawatt-hour. Oxford Economics expects the average price of European natural gas in the fourth quarter of 2026 and the first quarter of 2027 could be close to EUR 60 per megawatt-hour. If current natural gas wholesale prices remain unchanged, overall eurozone inflation in the second half of 2026 could be close to 3.5%, higher than its latest baseline forecast of slightly above 3%. The Middle East situation continues to disrupt market supply, and natural gas transportation is struggling to fill the market gap. Before the war, about one-fifth of the world's crude oil and liquefied natural gas (LNG) was shipped to global markets via the Middle East's Strait of Hormuz. Although some crude oil tankers are still transiting this key waterway, Qatar's LNG exports through the Strait of Hormuz have essentially come to a standstill. The UAE appears to still be loading LNG cargo ships in the Persian Gulf, but overall volumes are far below pre-war levels. The market is widely concerned that if the situation escalates further, energy exports across the entire Gulf region will face a greater risk of broader disruption. The obstruction of the Strait of Hormuz has had a major impact on LNG exports from Qatar and the UAE, whose LNG export capacity accounts for about 20% of global supply. Reduced supply from the Gulf region has in turn increased the cost of Europe's "restocking." This year, Europe's natural gas "restocking" is facing multiple pressures on both the supply and demand sides. Low inventories have further intensified market concerns about insufficient supply. With the heating season approaching, Europe is facing enormous natural gas restocking pressure. Currently, the overall fill rate of Europe's gas storage facilities is only about 66%, the lowest level for the same period on record. Germany's situation is particularly severe, with storage levels at only 54%, far below the average for the same period in previous years. HSBC forecasts that by November 1, Europe's natural gas inventory ratio will reach only 73%, the lowest level for the same period since relevant data began being collected in 2009. The unusually low inventory levels mean that even if winter temperatures are normal, Europe may face a tight supply situation. Should a cold snap occur or the Middle East situation continue to deteriorate, gas prices could surge further. ING Groep NV strategists Warren Patterson and Ewa Manthey noted in a research report this week: "Escalation in the Persian Gulf has further delayed hopes for a recovery in the region's LNG exports." They expect that as winter approaches, the LNG competition between Europe and Asia will become increasingly intense, "especially given that Qatari LNG will most likely remain absent from the market through the end of the year." Timera Energy analysts warned that the direct consequence of low storage levels is a "more fragile winter supply-demand balance," adding that "this will amplify the potential for price volatility when cold weather or a new round of supply shocks occurs, and at that point the response speed of cargo ships may not be able to keep up with changes in demand." Related Concept Stocks KUNLUN ENERGY (00135): For the six months ended June 30, 2026, the company achieved operating revenue of RMB 100.042 billion, up 2.56% year-on-year; profit attributable to shareholders was RMB 3.306 billion, up 4.59% year-on-year. During the period, amid a severe operating environment marked by continued shocks from international geopolitical conflicts and weak supply and demand in the domestic natural gas market, the company's most important natural gas sales segment effectively withstood downward pressure, while operating results in other business segments also maintained a relatively good level, with overall profitability achieving steady growth. CHINA RES GAS (01193): For the six months ended June 30, 2026, the company's revenue was HKD 53.381 billion, up 5.2% year-on-year; profit attributable to owners of the company was HKD 2.429 billion, up 1.0% year-on-year. In the first half of 2026, the group sold a total of 20.86 billion cubic meters of natural gas, of which industrial gas sales volume reached 9.69 billion cubic meters, commercial gas sales volume reached 4.68 billion cubic meters, and residential gas sales volume reached 6.12 billion cubic meters. ENN ENERGY (02688): Interim results showed that the group recorded revenue of RMB 57.021 billion (same unit below), up 2.4% year-on-year; profit attributable to owners of the company was RMB 2.667 billion, up 9.8% year-on-year. In the first half of the year, the group actively pursued its strategic positioning of "using intelligent innovative services to become a service provider that creates multi-product value for customers based on natural gas business." Customer scale continued to expand, with household customers reaching 33.26 million and industrial and commercial customers reaching 328,000.