European benchmark gas futures climbed above €85/MWh after a 2.7% rise the prior
session as traders assess Middle East conflict risks and regional supply
uncertainty. Talks to end the Iran war have made little progress and attacks on
tankers near the Strait of Hormuz continued this week. IRNA reported Iran’s top
security official denied negotiating with the US and called US claims of
Qatar-mediated talks false and intended to depress oil prices. European LNG
imports lag year-earlier levels and abnormally low winter stocks are drawing
down with the heating season. This winter’s supply balance for Europe hinges on
a rapid recovery of Strait of Hormuz shipments, especially Qatari flows. The
Iran conflict has removed roughly one-fifth of global LNG exports from the
market, forcing Europe to compete with Asia for scarce cargoes; regional gas
prices are at their highest since 2022 and more than three times their level at
the start of the year.
