European Gas Extends Gains

European natural gas prices extended rally, climbing above €70/MWh on Tuesday, the highest level since January 2023, as the flare-up in US-Iran tensions heightened concerns over Europe’s gas supply security heading into the heating season. The US and Iran exchanged strikes for the first time in a month over the weekend, threatening to prolong the effective closure of the Strait of Hormuz, through which roughly one-fifth of global LNG trade normally passes. The prospect of sustained disruption has intensified competition with Asian buyers, tightening supplies bound for Europe during the critical gas-storage refill season. EU gas storage facilities were around 64% full, below historical levels for this time of year. Low storage levels and uncertainty over LNG supplies from the Persian Gulf are putting upward pressure on prices, offsetting milder weather forecasts for early September that could limit near-term demand.

Natural Gas EU rose above 70, according to trading on a contract for difference (CFD).

European natural gas prices rose above €69/MWh, the highest since January 2023, as renewed fighting in the Middle East raised concerns over further delays to LNG exports from the Persian Gulf. Iran said it launched an attack on US air bases in Jordan hours after US forces struck two Iranian launchers on an island in the Strait of Hormuz, escalating tensions after a week of mediation efforts failed to break the stalemate between the two nations. The disruptions have already constrained LNG exports from major Gulf producers such as Qatar, tightening supplies to Europe during the critical gas-storage refill season. European storage facilities were 63% full in the final week of August, well below historical averages and among the lowest levels recorded for this time of year. Although the European Commission has recently indicated there is no immediate threat to gas supplies, traders are concerned that intensified competition with Asia for supplies could push prices even higher.