Middle East Tensions Send UK Gas Prices Soaring
UK natural gas prices have been on the rise, reaching 179 pence per therm on Friday as investors reacted to renewed tensions in the Middle East. The recent flare-up was sparked by a US attack on Iran that led to retaliatory strikes on American bases across the region.
The Strait of Hormuz remains a focal point for concern, with President Trump indicating that further strikes on Tehran would not be long-lasting but acknowledging ongoing tensions.
As a result, European gas prices have hit their highest level in over three years, and UK gas prices have climbed more than 8% this week, their fourth consecutive weekly gain. This uptick is despite the recent decline from previous highs.
The ongoing shipping paralysis in the Gulf region continues to hamper LNG supplies to Europe, slowing inventory replenishment ahead of winter. Europe's gas inventories remain abnormally low, heightening concerns about potential price spikes during colder months.