FX.co ★ European Gas Climbs Amid Supply Concerns

European natural gas prices climbed to €73.7/MWh on Tuesday, holding near their highest level in more than three and a half years, as LNG supplies from the Persian Gulf remained heavily disrupted amid escalating US-Iran tensions. The intensifying conflict between the two countries has highlighted the challenges of securing a resolution that would allow the reopening of the Strait of Hormuz. On Monday, Iran warned that energy infrastructure across the region — including US oil and gas facilities — could be exposed to further attacks. In response to ongoing shipping disruptions along this critical chokepoint, Qatar has largely halted LNG shipments and extended force majeure on cargoes destined for both European and Asian markets through the autumn. The resulting decline in LNG inflows has slowed the pace of gas injections into European storage, with EU storage sites now about 66% full, below the seasonal norm. This shortfall is leaving the region’s gas market increasingly exposed as the heating season draws nearer.