EMEA Natural Gas Update: Futures Edge Higher on Escalating US-Iran Conflict, Weak EU Storage Levels
European natural gas futures edged higher on Thursday as escalating hostilities between the US and Iran fueled concerns over LNG supplies and energy shipments through the Middle East.The front-month Dutch TTF contract rose 0.19% to 62.655 euros ($71.55) per megawatt-hour, while the front-month UK NBP contract gained 0.05% to 151.500 British pence ($2.03) per therm.On Wednesday, in a post on X, US Central Command said that it had completed another round of strikes against Iran, for the 12th consecutive day, targeting the country's military infrastructure, aimed at impairing its ability to target commercial vessels along the Strait of Hormuz.This comes following US President Donald Trump's latest warning that US forces would now strike Iran's power plants and bridges each time Tehran targets commercial traffic in the Hormuz.Meanwhile, traffic along the strategically crucial Strait, which accounted for one-fifth of global LNG flows, held steady with 15 transits on Wednesday, despite mounting tensions, according to data from ShipFinder.Daniel Hynes, a senior commodity strategist at ANZ, warned that Europe was "running out of time to replenish its gas reserves ahead of next winter," as competition for LNG cargoes intensifies, especially from Asian buyers amid mounting global supply constraints.Hynes also noted that the hopes of Qatari supplies resuming had begun to fade, with the country now offering sub-charters for its LNG tankers near the US coast, indicating that it was in no hurry to scale its output back to normal.This comes at a time when European gas inventories remain depleted, at just 54.38% of capacity, compared to 65.36% during the corresponding period a year ago, according to Gas Infrastructure Europe.Inventories were also significantly below the five-year average for this period, at 70%, according to data from the Swiss Federal Office of Energy.