European Natural Gas Climbs as Middle East Tensions Persist

European natural gas prices fell below €78/MWh, retreating from an over three-week high after President Trump said the US would not resume military strikes on Iran before November’s midterm elections, easing fears of an escalation in the conflict. However, supply risks persist as Iran stepped up tanker attacks in the Strait of Hormuz, a chokepoint for 20% of global LNG trade, raising concerns over the safety of transits. Meanwhile, cooler weather forecasts for Northwestern Europe could lift heating demand and support gas consumption. While Europe's gas inventories have risen steadily in recent weeks, facilities are around 73% full, remaining below year-ago levels. The region’s gas network operators said the system is flexible enough to meet winter demand but warned that limited LNG supplies could push storage below 30% by winter’s end, increasing vulnerability to late-season cold snaps. Despite Friday’s pullback, prices are up about 4% this week, marking a second weekly gain.

European natural gas prices rose toward €80/MWh, the highest level in more than three weeks, as continued tanker attacks in the Strait of Hormuz fueled supply concerns. Iran has sharply increased attacks on commercial and energy vessels transiting the waterway, highlighting persistent shipping risks and threatening to disrupt the broader recovery in fuel deliveries. Reports that Washington has asked the Pentagon to prepare options for potential strikes on Iran before the November midterm elections also heightened fears of an escalation in the conflict. Further supporting prices, forecasts point to cooler weather across Northwestern Europe, which could boost heating demand as the region heads into winter. This weather-driven support comes amid steady additions to European storage reserves, with facilities now around 73% full. Still, storage levels remain below last year's, leaving the region vulnerable to prolonged supply disruptions and sudden demand spikes.

European natural gas prices rose above €76/MWh, their highest level in over two weeks, as ongoing security risks around the Strait of Hormuz continued to threaten LNG flows from the Persian Gulf. The waterway, which handled roughly a fifth of global oil and LNG trade before the war, has seen attacks on vessels in recent weeks, raising concerns over the security and reliability of shipping. Although outbound traffic in September reached its highest level since the war began in late February, LNG flows remain over 75% below pre-war levels. In addition, QatarEnergy recently extended force majeure on LNG deliveries to Italy’s Edison through December. Europe is racing to replenish reserves ahead of winter, with gas storage levels at around 72% of capacity, well below the five-year seasonal average of 87%. With inventories lagging seasonal norms, any prolonged disruptions or a colder-than-expected start to the heating season could further tighten the market and drive prices higher.