European Gas Prices Rise on Ongoing Hormuz Tensions
European natural gas prices rose on Friday as traders watched for further developments in efforts to revive shipping through the Strait of Hormuz. The price increase follows oil's upward movement, with benchmark futures rising in a choppy session amid signs that Iran and the US remained far apart on a new ceasefire deal or the reopening of the strait.
Tehran has reiterated its proposal, which President Donald Trump has rejected. However, Trump indicated that negotiations could resume this week, with Iran set to meet mediators on Monday, according to the semi-official Iranian Students' News Agency.
The prolonged disruption in the critical waterway is setting the stage for intense competition among global buyers of natural gas. Europe is running out of time to rebuild its unusually low gas inventories before the heating season, with around a fifth of the world's liquefied natural gas (LNG) used to transit Hormuz.
The European Union has warned member states about a potential energy price crisis, asking them to consider measures to cut demand and continue filling storage. The region is particularly vulnerable as it is currently 71% full - well below the five-year seasonal average of 87%. In Germany, which has Europe's largest storage capacity, facilities are just over 57% full.