European natural gas futures dropped below €47 per megawatt hour as optimism grew that the United States and Iran could strike a deal to reopen the Strait of Hormuz, a crucial chokepoint for global energy shipments. Market sentiment improved even amid mixed signals: Iranian state television reported the existence of an unofficial draft for an interim agreement, while the White House dismissed the account as “a complete fabrication.”
The Strait of Hormuz typically carries around 20% of global oil and LNG trade, and a reopening would help relieve pressure on energy markets. The prolonged disruption has fueled worries that Europe may struggle to replenish gas inventories ahead of the winter heating season. Storage sites are currently only about 38% full, well below the five‑year average of more than 50% for this time of year.
Further clouding the demand outlook, Europe is experiencing its first major heat wave of the season, with record temperatures forecast in cities including London, Paris and Madrid.
