US Natural Gas Prices Climb

US natural gas futures climbed more than 2% to around $3.02 per MMBtu on Tuesday, building on Monday’s 3.5% gain amid concerns over supply disruptions due to widening conflict in the Middle East. A high-ranking Iranian official on Monday said the Strait of Hormuz has been closed and warned that it would “burn any ship” attempting to transit the strategic waterway. The Strait is a critical chokepoint for global energy flows, accounting for roughly 20% of LNG exports, primarily from Qatar. Compounding the risk, QatarEnergy, one of the world’s largest LNG producers, halted operations after Iranian drones targeted its Ras Laffan and Mesaieed facilities. Any prolonged disruption could boost demand for US LNG, particularly as the domestic natural gas market is running a 0.3% deficit relative to its five-year average.

US natural gas futures rose past $3 per MMBtu on Monday before paring some gains to settle at $2.9 per MMBtu, as escalating tensions in the Middle East stoked concerns over supply disruptions. The rally followed a series of attacks by the US and Israel on Iran, which prompted retaliatory strikes by Tehran against regional targets. QatarEnergy halted LNG production at its Ras Laffan complex following military attacks. It adds to early concerns over tanker traffic through the Strait of Hormuz, which has largely stalled, with no clear timeline for a safe return to normal operations. Although Tehran insists the waterway remains open, several shipping companies have begun rerouting vessels away from the narrow passage as a precaution. The Strait of Hormuz handles roughly 20% of global LNG trade, including significant exports from Qatar. Any disruption could increase demand for US LNG, particularly as the natural gas market is currently running a 0.3% deficit relative to the 5-year average.

US natural gas futures climbed more than 4% on Monday, approaching $3 per MMBtu, as prices rebounded sharply from the September lows reached last week. The rally tracked broader gains across energy markets after the US and Israel carried out a series of attacks on Iran, prompting retaliatory strikes by Tehran against targets in the region. Tanker traffic through the Strait of Hormuz, a critical maritime chokepoint, largely stalled amid the escalating conflict, with no clear timeline for a return to normal and safe operations. Although Tehran maintains that the waterway remains open, several shipping companies have begun rerouting vessels away from the narrow passage as a precaution. The strait handles roughly 20% of global LNG trade, including significant exports from Qatar. Disruptions in the Strait of Hormuz could boost demand for US LNG, particularly as the domestic natural gas market is currently running at a 0.3% deficit compared with the five-year seasonal average.