FX.co ★ UK Natural Gas Prices Decline

UK natural gas futures slipped below 117 pence per therm, retracing part of the previous session’s sharp rally that had been driven by stalled US-Iran peace negotiations. Prices jumped 7.5% on Monday amid escalating geopolitical tensions, after Iran halted indirect talks in response to intensified Israeli attacks in Lebanon and warned it could extend its current blockade from the Strait of Hormuz to the Bab el-Mandeb Strait, a crucial shipping route at the southern gateway to the Red Sea. At the same time, President Donald Trump said discussions were still under way and that he expected a deal to be reached within the next week. The ongoing closure of the Strait of Hormuz has disrupted around 20% of global LNG shipments, tightening supply and heightening competition for cargoes among importing countries. With gas storage levels at just 38% of capacity, the prolonged disruption is making it harder for Europe to rebuild inventories ahead of next winter.