European natural gas futures rallied on Wednesday, climbing to their highest level since December 2022 after Iran announced plans for a new restricted zone for commercial vessels transiting the Strait of Hormuz.
Front-month Dutch TTF futures rose 3.22% to 78.285 euros ($91.11) per megawatt-hour, while UK NBP futures gained 3.07% to 194.600 British pence ($2.64) per therm.
On Wednesday, a spokesperson for Iran's Revolutionary Guard Corps said a new restricted zone would soon be established, stretching from Chabahar in Iran into parts of the Gulf of Oman and the Arabian Sea, with vessels entering the area set to face sanctions, according to an Al Jazeera report.
Meanwhile, the US Centcom said in a post on X that it destroyed five Iranian tankers on Tuesday, in response to the IRGC targeting a US Navy ship with ballistic missiles, "twice over the past two days."
Iran responded by launching missile attacks on US forces stationed at the Al Azraq base in Jordan, while claiming to have carried out additional strikes on at least two US vessels and eight tankers in the region, causing what it described as "great damage," according to a report by Al Jazeera.
Despite this, however, traffic through the strait edged higher with 23 transits on Tuesday, according to ShipFinder.
Daniel Hynes, senior commodity strategist at ANZ, said Qatar sent its first LNG cargo through the Strait of Hormuz since July.
He highlighted disruptions to Norwegian and Algerian flows as major facilities entered maintenance, weighing on Europe's ability to refill inventories ahead of the heating season.
European gas inventories remained below historic averages, at 67.12%, compared to 79.48% during the corresponding period a year ago, according to Gas Infrastructure Europe.
Inventories were also significantly below the five-year average for this period, at 83.5%, according to the Swiss Federal Office of Energy.
Germany, with inventories at 54.75% of capacity, compared to 74.22% last year, was particularly vulnerable, with the country's storage operators raising the alarm earlier this week, while calling for a reduction in fees and levies during this period, as reported by.