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EMEA Natural Gas Update: Futures Slide After Trump Touts Peace Deal, Iran Unveils Terms

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European natural gas futures declined sharply on Friday after US President Donald Trump canceled strikes against Iran, while once again claiming that a peace deal with the country was close to being finalized.

The Dutch TTF front-month contract dropped 4.14% to 47.635 euros ($55.11) per megawatt-hour, while the UK NBP front-month contract was down 4.72% to 114.110 British pence ($1.52) per therm.

In a Truth Social post on Thursday, Trump said he had canceled the "scheduled strikes and bombings against Iran this evening" after discussions with Tehran were elevated to, and approved by, the highest levels of Iran's leadership.

He also added that the time and location for the formal signing of an agreement would be announced shortly, marking a major de-escalation in the conflict.

Iran has since revealed certain terms of the proposed peace deal, which involved the release of Iranian funds frozen by the US government and an end to Israel's war against Lebanon, and a 60-day extension to the ceasefire while nuclear discussions continue, according to a report by the IRNA News Agency.

Iran has also said that the administration of the Strait of Hormuz will be resolved as a regional matter "through dialogue and joint decision-making between Tehran and Oman," according to a report by Al Jazeera.

Meanwhile, the strategically crucial Strait of Hormuz, which accounted for one-fifth of global LNG flows, remained effectively shut for the 15th week running, with just two vessels transiting over the past 24 hours, according to the Hormuz Strait Monitor.

According to Daniel Hynes, a senior commodity strategist at ANZ, this protracted blockade in the Hormuz is forcing Asian buyers into the spot market, which he said "spells trouble for European consumers," as gas deliveries to the region dropped 19% over the past month.

European gas inventories remain comparatively low, at 43.36% of capacity, compared to 52.12% during the corresponding period a year ago, according to data from Gas Infrastructure Europe.

Inventories were also well below the five-year average for this period at 57.6%, according to the Swiss Federal Office of Energy.

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