Oil & Energy
EMEA Natural Gas Update: Futures Rally After US-Iran Resume Military Strikes
European natural gas futures rose on Wednesday after the US and Iran resumed military strikes, shattering a temporary lull in hostilities earlier this week.The front-month Dutch TTF contract was up 1.23% to 58.450 euros ($66.63) per megawatt-hour, while the front-month UK NBP contract was up 1.12% to 143.190 British pence ($1.90) per therm.The US Central Command said in a post of X Wednesday that Iran's Islamic Revolutionary Guard Corps launched multiple missile attacks "in an attempted surprise attack on US forces" located across the Middle East. US Centcom noted that all missiles were successfully intercepted.The US, along with the Saudi Arabian Armed Forces, has since launched strikes against Iran-aligned terrorists located in Iraq, targeting "multiple terrorist logistics and weapons sites."Meanwhile, traffic along the strategically crucial Strait of Hormuz, which accounted for one-fifth of global LNG flows, witnessed an uptick on Tuesday, at 19, despite the latest escalation in hostilities, according to ShipFinder.While supplies continued to remain constrained, China's LNG demand is set to climb for the third-straight month, with the country's inventories being heavily depleted, according to Daniel Hynes, a senior commodity strategist at ANZ.All of these factors are weighing on Europe's ability to refill its own inventories ahead of winter, as it competes with Asian buyers for limited supplies. Inventories in the region stood at 55.91%, compared to 67.28% 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 71.8%, according to the Swiss Federal Office of Energy.
