Gas prices in Europe sharply declined after President Trump’s imposition of reciprocal tariffs. There was a 20% drop in natural gas prices within a week.

In Europe, tensions escalated following President Trump’s announcement of reciprocal tariffs, sparking concerns about the stagnation the tariffs might cause in the global economy. Consequently, gas prices in Europe dropped by 20% within a week. In the Netherlands, home to the most prominent virtual natural gas trading hub in Europe known as TTF, the price per megawatt-hour closed at 41.2 euros on April 2nd. The sharp decline in gas prices in Europe became evident after President Trump declared April 2nd as a “day of salvation” for his country and announced reciprocal tariffs for trade partners. Gas prices in Europe opened at 39.2 euros per megawatt-hour on April 3rd, extending its losses into the new week. The escalating tension in tariff retaliation between the U.S. and China further intensified the pace of the price drop. Consequently, gas prices in Europe plummeted by 20% after April 2nd. Prices have decreased by 9.2% since the beginning of this week. With this decline, gas prices dropped to their lowest level since May 2024.

FEAR OF A DECLINE IN GAS DEMAND Concerns over a potential downturn in the global economy post-tariffs and the impact of this slowdown on gas demand triggered the price drop. Additionally, expectations that the U.S. might redirect its supply of liquefied natural gas (LNG) from China and Asia towards Europe after China’s retaliatory tariffs also influenced the decline in gas prices. Following the tariff retaliation between China and the U.S., the slowing economic growth in China and a downward trend in gas consumption in the industry heightened concerns about China’s total gas demand. The American investment bank Goldman Sachs lowered its growth forecast for the Chinese economy to 4% for this year and 3.5% for 2026 due to the economic effects of the tariffs. Previously, the bank had predicted growth rates of 4.5% for China this year and 4% in 2026. Following the latest announcements between the U.S. and China, China announced a 125% tariff under a reciprocal tariff policy against the U.S.’s 84% retaliatory tariff. The “tit-for-tat” approach between the two countries is increasingly adding uncertainty to the global economy and trade.