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EMEA Natural Gas Update: Futures Pare Gains after Iran Signals End to Operations Against Israel

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European natural gas futures pared earlier gains on Tuesday after Iran said it had ended military operations against Israel, easing concerns that the latest exchange of missile strikes could disrupt efforts to end the conflict and threaten efforts to restore energy flows through the Strait of Hormuz.

The Dutch TTF front-month contract was up 3.761% at 50.32 euros ($58.08) per megawatt-hour, while the British front-month NBP contract gained 3.845% to 121.55 pence ($1.62) per therm.

Prices had surged more than 5% in early trade, Trading Economic said, pushing the Dutch benchmark to around 51 euros/MWh, its highest level in nearly three weeks, after Israel and Iran exchanged missile strikes despite a ceasefire agreed in April.

Israel said it struck military targets in Iran in response to missile attacks launched by Tehran, which Iran described as retaliation for earlier Israeli strikes in Lebanon. The latest escalation came despite US President Donald Trump's call for Israel to avoid retaliatory action.

However, prices retreated from session highs after Iran signaled it was ending its military response, prompting expectations that further diplomatic efforts could help contain the conflict.

Market participants remain focused on Europe's ability to secure sufficient gas supplies ahead of winter.

Global LNG shipments to Europe have declined in recent weeks as demand from Asia strengthens, ANZ analyst Daniel Hynes said in a note on Monday.

China has returned to the spot LNG market, while demand in India is recovering as buyers seek additional cargoes to offset lower volumes from Qatar. India has also faced intense heatwaves this summer, driving record electricity demand and increasing reliance on gas-fired power generation during peak evening hours, he said.

European gas inventories remain well below last year's levels. Data from Gas Infrastructure Europe showed EU storage sites were 42.13% full, compared with nearly 51% at the same point a year earlier.

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