European natural gas futures edged lower on Thursday after reaching their highest level in over three years this week, as markets weighed President Trump's comments signaling the US campaign against Iran was unlikely to drag on much longer.
Front-month Dutch TTF futures dropped 1.53% to 72.510 euros ($84.28) per megawatt hour, while UK NBP futures declined 1.19% to 179.990 British pence ($2.43) per therm.
On Wednesday, Trump said that the renewed US campaign against Tehran was not going to last "too long," since Iran's infrastructure had been decimated, while speaking to reporters from the Oval Office.
Trump also noted that the US was in complete control of the Strait of Hormuz and was "bringing lots of boats out every day with millions of barrels of oil."
Meanwhile, Ebrahim Azizi, the chairman of Iran's National Security Committee, said that "the Strait of Hormuz will not reopen without the will of the Islamic Republic of Iran."
Traffic along the strategically crucial Strait of Hormuz, which accounted for one-fifth of global LNG flows, remained steady with 14 transits on Wednesday, according to ShipFinder.
Daniel Hynes, a senior commodity strategist at ANZ, noted that European markets continued to face difficulties "in attracting LNG to help refill storage facilities."
Hynes noted that Britain was in a particularly precarious position, prompting concerns that the country would have to pay a premium to secure supplies in winter.
European gas inventories stood at just 65.10% of capacity, compared with 82.59% in the same period a year ago, according to Gas Infrastructure Europe.
Inventories were also significantly below the five-year average for this period, at 82.7%, according to the Swiss Federal Office of Energy.
Fortunately, forecasts point to a relatively mild winter across much of Europe this year, with less snow than normal in most lowland and mid-elevation areas, according to a report by Severe-Weather EU, which should ease pressure on heating gas demand.