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EMEA Natural Gas Update: Futures Near 3-Month High as Iran Conflict Raises Supply Risks

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European natural gas futures climbed again on Thursday, trading near a three-month peak, as escalating US military strikes on Iran and Tehran's threats to target regional energy infrastructure intensified concerns over global energy supplies.

The front-month Dutch TTF contract rose 1.696% to 55.270 euros 1 per megawatt-hour, while the front-month UK NBP contract gained 0.917% to 132.080 British pence ($1.78) per therm.

Market sentiment was driven by ongoing geopolitical tensions in the Middle East after Iran's military warned that the Strait of Hormuz remained an "unbreakable red line" following escalating exchanges of fire with the US.

Iranian officials said the country would destroy "all infrastructure throughout the region" if US President Donald Trump followed through on threats to strike Iranian infrastructure, media outlets reported Thursday.

Adding to energy supply concerns, on Thursday, Reuters reported Iran has requested Yemen's Houthi movement to prepare to close the Red Sea oil route if the US attacks Iranian power infrastructure.

The heightened geopolitical risk comes as Europe faces a more challenging gas storage outlook ahead of the winter heating season.

Gas Infrastructure Europe data showed European gas inventories at 52.77% of capacity, well below the 63.32% level recorded during the same period last year.

Inventories were also below the five-year average of 68% for this time of year, according to the Swiss Federal Office of Energy.

"Europe and Asia will now have to compete for the remaining LNG over the summer, a competition which will become even fiercer if the current heatwave weather continues during the second half of the summer," Mind Energy said on Thursday.

The LNG market is already showing signs of tighter regional competition. Reuters reported on Tuesday that Asian LNG imports are expected to reach a six-month high in July, while European imports are set to fall to their lowest level in nearly two years.

Although stronger Asian demand is partly driven by seasonal summer consumption, weaker European imports highlight the region's slower progress in rebuilding gas inventories ahead of winter, increasing exposure to supply shocks and geopolitical disruptions, Reuters said.

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