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EMEA Natural Gas Update: Futures Mixed as Fresh US Strikes Against Iran Disrupt Peace Negotiations

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European natural gas futures were mixed on Tuesday, as fresh US strikes against Iran quelled market optimism regarding a peace deal and a quick end to hostilities in the region.

Front-month Dutch TTF contracts rose 4.49% to 47.470 euros ($55.21) per megawatt hour, while the UK NBP front-month contract declined 2.67% to 115.310 British pence ($1.55) per therm.

US forces conducted "self-defense" strikes in Southern Iran on Monday, according to Captain Tim Hawkins, a spokesperson for the Centcom, who said that the strikes mainly targeted "missile launch sites and Iranian boats attempting to emplace mines."

Abolfazl Shekarchi, a spokesperson for Iran's armed forces, has since warned of a "far more severe" retaliation against such aggressions, threatening to attack beyond the region's borders, according to a report by Al Jazeera.

This has crushed hopes of a quick resolution to the conflict, with US Secretary of State Marco Rubio saying that a lasting deal to end the war could "take a few days," due to a lot of back-and-forth discussions, while speaking to reporters during his visit to India on Tuesday.

Meanwhile, the Strait of Hormuz, which handled one-fifth of global LNG flows, remained effectively closed for the 13th week running, with 33 vessels transiting over the past 24 hours, according to the Hormuz Strait Monitor.

While this marks a major uptick in traffic compared to the low-to-mid single-digit figures in recent weeks, it is still significantly below the typical daily average of 138 vessels before the conflict began.

QatarEnergy has reportedly told its major European customer, Edison, that it was canceling five additional LNG cargoes that were set for delivery between July and mid-August 2026, extending its force majeure notice, according to a Reuters report.

Geopolitical strategist Cyril Widdershoven argued on Tuesday that the markets were "celebrating far too early," noting that even with a successful peace agreement, the Hormuz would require extensive mine-clearing operations, while insurers would continue to remain cautious, keeping risk premiums elevated.

This comes at a critical juncture for European markets, with gas inventories depleted at 38.21% of capacity, compared to 45.95% during the corresponding period a year ago, according to data from Gas Infrastructure Europe.

Inventory levels were also significantly below the five-year average for this period, at 52.2%, according to the Swiss Federal Office of Energy.

To make matters worse, Europe is currently at the center of "a historic, record-shattering heatwave," with temperatures soaring between 12 and 16 degrees Celsius above the long-term climatological norms, leading to higher cooling gas and power burn demand, according to Severe-Weather EU.

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