European natural gas prices dropped below €59 per megawatt-hour, as renewed optimism over US-Iran negotiations eased fears about potential supply disruptions. Pakistan’s Defense Minister Khawaja Asif said the two sides were “close to some sort of arrangement,” and discussions between Iran and Oman on reopening the Strait of Hormuz were reportedly well advanced. Any agreement could help restore LNG shipments through the Persian Gulf and alleviate pressure on European gas markets.
Despite the improved sentiment, Commerzbank raised its year-end European gas price forecast to €50/MWh from €45/MWh. Uniper also expects prices to remain in the €50–€60/MWh range as long as the Strait of Hormuz stays closed. European gas storage has recently fallen to its lowest level for this time of year in records dating back to 2009, intensifying worries over winter supply security. At the same time, persistent heatwaves across Europe are driving up power demand, further straining gas markets.
