Gas Markets Price Prolonged Tightness as Iran Conflict Continues
Global gas markets are pricing in prolonged tightness due to the ongoing conflict between Iran and other nations. According to Menelaos Ydreos, secretary general of the International Gas Union (IGU), forward gas prices indicate traders expect elevated prices and supply risks to persist through next summer before easing.
The conflict is disrupting Gulf liquefied natural gas exports, which is affecting Europe's efforts to rebuild gas inventories. Europe is competing with Asia for LNG cargoes while attempting to refill storage sites ahead of winter.
'The market right now is saying that they see the conflict getting prolonged,' Ydreos told Reuters. Current futures curves indicate markets expect tight conditions to continue into next year, a marked shift from a few months ago when traders expected prices to ease after winter.