UK Natural Gas Prices Surge on Middle East Peace Deal Uncertainty

UK natural gas prices have been on the rise due to uncertainty over a Middle East peace deal. This has led to supply risks, causing prices to jump and move closer to their highest level since January 2023. The price of UK natural gas rose to 170 pence per therm on Friday, marking an extension of gains from the previous session. This increase was driven by reports that President Trump was not interested in returning to the terms of a June deal with Iran.

The Strait of Hormuz has been disrupted due to the near-closure, affecting LNG supplies from Qatar. The extreme summer heat-driven cooling demand has also diverted supplies from storage, leaving Europe scrambling to secure supplies and heightening fears that the region could enter the winter heating season with insufficient reserves.

The UK gas prices rose around 4% for the week, marking their third consecutive weekly gain.