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EMEA Natural Gas Update: Futures Rise Despite Trump's Optimism on Deal With Iran

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European natural gas futures rose on Tuesday, even after US President Donald Trump called off strikes against Iran, while expressing optimism regarding a potential peace deal with the country.

The front-month Dutch TTF contract rose 1.5% to 51.03 euros ($59.27) per megawatt hour by late trade, while the UK front-month NBP contract was up 1.2% at 124.8 pence ($1.67).

In a Truth Social post on Monday, Trump said that he was asked to "hold off on our planned Military attack" against Iran by the leaders of several Arab states.

This comes after Iran shared a new 14-point proposal with the US via a Pakistani mediator on Monday, according to a report by the state news agency Tasnim.

While speaking to reporters at a White House event on Monday, Trump said this was a "very positive development" while acknowledging that he was unsure if it would amount to anything. He also said that there was "a good chance" of a deal with Tehran in the coming days.

Meanwhile, the strategically crucial Strait of Hormuz remained effectively closed for the 12th week running, with just 8 vessels transiting over the past 24 hours, according to the Hormuz Strait Monitor.

According to Daniel Hynes, a senior commodity strategist at ANZ, European gas markets have continued to tighten, as more flows get rerouted to Asia, where supply constraints due to the Middle East conflict have been felt the most.

He also noted that the situation was "exacerbated by potential disruptions to Australian supplies" amid the wave of strikes and work bans at Inpex's Ichthys liquefied natural gas facility.

All of this comes at a critical juncture for European markets, with gas inventory replacement slow with reserves at 35.56% of capacity compared to 44.43% during the corresponding period a year ago, according to data from Gas Infrastructure Europe.

Similarly, inventory levels are significantly below the five-year average for this period, at 50.1% of capacity, according to the Swiss Federal Office of Energy.

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