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EMEA Natural Gas Update: Futures Rise Roughly 4% Despite Uptick in Hormuz Traffic

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European natural gas futures were up on Friday despite an uptick in Strait of Hormuz traffic, after Iran permitted several vessels to transit through the Strait.

The front-month Dutch TTF contract gained 3.68% to 49.41 euros ($57.46) per megawatt hour, while the UK NBP front-month rose 4.23% to 121.72 British pence ($1.64) per therm. Both Dutch TTF and UK Gas were set to end the week up by 12.16% and 12.87%, respectively, according to TradingEconomics.

On Thursday, Iran's Revolutionary Guards said around 30 ships had crossed the strategically crucial strait, after taking Tehran's permission, according to a report by the Times of India.

This was confirmed by the Hormuz Strait Monitor, which reported 30 vessels transiting through the Strait over the past 24 hours, marking a major uptick in traffic relative to recent weeks. This is, however, still significantly below the typical daily average of 138 vessels before the conflict began.

On Thursday, US President Donald Trump escalated threats against Iran, warning that he would not be "much more patient" going forward, during an interview with Fox News' Sean Hannity.

Iranian Foreign Minister Seyyed Abbas Araghchi has said that the US should abandon its maximalist demands to proceed with a deal during a meeting with Thai Foreign Minister Sihasak Phuangketkeow during the BRICS meet in New Delhi on Thursday.

According to Daniel Hynes, a senior commodity strategist at ANZ, there are still little to no signs of supply disruptions easing.

At the same time, he warned that the "pockets of demand for LNG" across South Asia, could intensify competition with European markets, for a limited pool of global supplies.

This also comes at a time when Europe is knee deep into its refilling season with significantly depleted gas inventories, at 35.85% of capacity, compared to 43.36% last year, according to Gas Infrastructure Europe. Inventories were also below the five-year average of 48.8% during this period, according to the Swiss Federal Office of Energy.

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