European natural gas prices hit near four-year high, raising winter power supply risks; Phase II of the world’s largest integrated green hydrogen-ammonia-methanol project breaks ground
（2026/10/19—2026/10/25）
Author: Shu-Xin Zhang
International Energy News
1. European natural gas prices hit near four-year high, raising winter power supply risks
On October 13 local time, benchmark European natural gas prices surged sharply to their highest level since December 2022. The Dutch Title Transfer Facility (TTF) natural gas futures, the price benchmark for Europe, broke through 86 euros per megawatt hour, equivalent to about 645 yuan. Coupled with below-average inventory levels and the approaching cold weather, tight supply and demand persisted, stoking early market concerns over winter energy security. At present, European natural gas storage facilities stand at 73.75%, well below normal levels for this time of year.
Natural gas serves as a core regulating fuel in Europe’s power mix. EU official data shows gas-fired power accounted for roughly 16.7% of total power generation in 2025. It acts both as stable baseload power and a major peaking resource to offset the intermittency of wind and solar, playing a critical role in safeguarding power supply amid fluctuating renewable output.
Weather forecasts indicate temperatures in northwest Europe will drop further from next weekend, gradually boosting residential heating demand and accelerating drawdowns of gas inventories. Once the heating season kicks in, heating and power-generation gas demand will overlap markedly. Higher gas prices will quickly pass through to power markets, pushing up wholesale electricity prices and increasing cost pressure for energy-intensive industries and households. Analysts warn that gas prices could rise further if cold snaps are more intense than expected or unexpected supply disruptions emerge, making winter power supply in Europe more challenging.
2. Middle East oil exports rebound to pre-conflict levels
Shipping firms have rerouted vessels to avoid conflict-prone waterways including the Strait of Hormuz, lifting Middle East oil exports back to pre-war volumes. Energy analytics firm Kpler’s data shows Gulf oil exporters (excluding Iran) shipped 24.6 million barrels per day in the week ending October 18, above the pre-conflict average of 23.3 million barrels per day. This seven-day average marked the highest level since mid-February, shortly before strikes by the United States and Israel against Iran disrupted exports from this world-crucial oil-producing region. The preliminary figures show far greater volatility than before the conflict. The dataset covers shipments through the Strait of Hormuz, ship-to-ship transfers outside the strait and crude flows from Red Sea ports. Even so, crude volumes passing directly through the Strait of Hormuz remain more than one-third lower than pre-conflict levels.
Despite the rebound in overall exports, oil prices have climbed in recent months, with mounting pressure on some refined product markets. The global Brent benchmark hit its highest level since May on Tuesday, before rising 2.1% on Wednesday to settle at 111.03 US dollars per barrel. Saudi Arabia has diverted large volumes of crude to the Red Sea’s Yanbu port, though this alternative route faces periodic capacity disruptions as pipelines and vessels nearby come under repeated attacks. UK Maritime Trade Organization (UKMTO) records show 28 shipping attacks in the region in October, up from 18 in September. Exports have remained robust this month notwithstanding the rising assaults.
3. China’s green power exports drive energy transition in developing economies
From photovoltaic plants across Southeast Asia, hydropower projects in South Asia, to off-grid solar systems serving remote communities in Africa, Chinese green energy cooperation has expanded into developing economies in diverse forms. These projects deliver additional clean power locally while creating opportunities for employment, technical training and industrial growth. As energy transition becomes a priority agenda for a growing number of developing nations, China’s complete new-energy industrial chain, engineering and operation capacity offers more pathways for these countries to develop renewables.
In 2021, China announced it would no longer build new overseas coal-fired power plants. Since then, low-carbon green energy has become a core pillar of energy cooperation under the high-quality Belt and Road Initiative. Chinese firms keep building photovoltaic, wind and hydropower assets, supporting partner countries to advance their energy transition through green energy collaboration.
Domestic energy news
1. Phase II of the world’s largest integrated green hydrogen-ammonia-methanol project breaks ground
On the 20th, Phase II of the “Qingqing No.1” China Energy Songyuan Hydrogen Industrial Park (integrated green hydrogen-ammonia-methanol project), invested and developed by China Energy Engineering Corporation (CEEC), started construction in Songyuan, Jilin Province. It is China’s first large-scale wind-solar coupled green hydrogen-to-green ammonia project and currently the largest integrated green hydrogen-ammonia-methanol facility worldwide. Phase I was put into operation in December 2025. Upon completion of Phase II, the combined capacity of the two phases will reach 600000 tonnes of green ammonia annually, taking China’s wind-solar coupled green hydrogen and green ammonia sector from demonstration validation into large-scale commercial operation.
Project insiders stated that Phase II will leverage CEEC’s strengths in investment, construction and operation, commercialization and industrial chain integration, alongside local resource advantages in Songyuan. It aims to build a national-level hydrogen-ammonia-methanol production base with scale, demonstration value and strategic significance, supporting Jilin Province’s push to build a national hub for green energy and green liquid fuel supply. Phase II carries a total investment of 10.828 billion yuan and delivers systematic improvements across scale, equipment, technology, economic performance and market access. Its new energy installed capacity doubles to 1600 megawatts under an “on-site self-consumption with surplus electricity exported to grid” model. It hosts two sets of 200000-tonne-per-year synthetic ammonia units and a 126000-Nm³ water electrolysis hydrogen production unit, lifting annual green hydrogen and green ammonia output to 90000 tonnes and 400000 tonnes respectively, twice the capacity of Phase I. The operating flexibility of ammonia units is widened to 7.5%–110%, cutting energy and equipment losses. By spreading fixed costs via scale expansion, lowering energy and material consumption through technological upgrades and locking in green premiums with offtake agreements, the project helps strengthen the international competitiveness of China’s low-carbon fuels.
2. China’s total electricity consumption rises 3.9% year-on-year in the first three quarters
From January to September, total national electricity consumption reached 8073.4 billion kilowatt hours, up 3.9% year-on-year. By sector, primary industry consumed 118.2 billion kilowatt hours (+3.4% YoY); secondary industry consumed 5109.8 billion kilowatt hours (+4.1% YoY), including industrial use of 5063.2 billion kilowatt hours (+4.3% YoY) and consumption by high-tech and equipment manufacturing of 961.9 billion kilowatt hours (+8.7% YoY). Tertiary industry used 1610.9 billion kilowatt hours (+6.8% YoY). Electricity consumption of charging and battery-swapping services and internet data services hit 131.5 billion and 79.3 billion kilowatt hours, growing 55.4% and 41.6% respectively. Residential power use stood at 1234.6 billion kilowatt hours, down 0.3% year-on-year.
In September alone, national electricity use totalled 899.7 billion kilowatt hours, a 1.2% year-on-year increase. Primary industry consumption was 13.5 billion kilowatt hours (+4.1% YoY); secondary industry 580.0 billion kilowatt hours (+1.7% YoY), among which industrial use reached 575.1 billion kilowatt hours (+1.8% YoY) and high-tech and equipment manufacturing used 116.7 billion kilowatt hours (+4.6% YoY). Tertiary industry consumed 185.2 billion kilowatt hours (+4.9% YoY). Charging and swapping services and internet data services consumed 16.8 billion and 9.8 billion kilowatt hours, with growth rates of 57% and 35.4%.
3. China’s first “molten salt energy storage + supercritical CO₂ power generation” project starts construction, scheduled for commissioning in 2027
Construction kicked off for “Ruitanhao”, China’s first demonstration project combining molten salt energy storage and supercritical carbon dioxide power generation in Yantai, Shandong Province. The milestone marks key progress in integrating supercritical CO₂ power cycles with new energy storage in China. The project serves as the demonstration carrier for the national major science and technology programme “Key technology development and engineering demonstration of carbon dioxide thermal batteries”, adopting an innovative operational scheme pairing molten salt storage with CO₂ power generation.
The first phase includes one 50-megawatt supercritical CO₂ power generator using supercritical carbon dioxide as the working fluid, alongside a 100-megawatt/400-megawatt-hour molten salt energy storage system. During off-peak hours, surplus power from the existing thermal units at Huaneng Shandong Bajiao Power Plant heats molten salt to store energy as thermal heat. At peak demand, high-temperature molten salt releases heat to warm carbon dioxide and drive the turbine for power output. Scheduled for commissioning in 2027, the project will accumulate practical experience for scaled multi-scenario deployment of advanced energy storage and support the development of China’s new power system.
(Main news sources: CCTVNEWSAPP, Xinhua New Media, International Energy Network, China Energy Network, National Energy Administration)
