Key Moments
- Benchmark Dutch front-month gas slipped 1.7% to 72.23 euros per MWh after touching a multi-year high of 74.32 euros earlier in the week.
- UK NBP wholesale gas declined 2.7% to 178.08 pence per therm, easing from a move above 183 pence that marked the highest level since late 2023.
- Despite the pullback, traders reported that geopolitical risk premia remained firmly embedded in prices amid disrupted LNG flows through the Strait of Hormuz.
Prices Cool After Rally Beyond War-Time Peaks
European and UK wholesale natural gas benchmarks softened for a second straight session on Thursday, as trading desks moved to crystallize profits following a sharp, multi-session rally that had driven prices above levels seen during the fifth month of the Middle East conflict.
The front-month Dutch gas benchmark declined 1.7% to 72.23 euros per megawatt-hour (MWh), extending its retreat from the multi-year high of 74.32 euros that it reached earlier in the week.
In the UK, the comparable NBP front-month contract fell 2.7% to 178.08 pence per therm. That move followed a break above 183 pence in the prior session, which marked the contract’s highest reading since late 2023.
Market participants characterized Thursday’s trading as a largely technical pause rather than a signal of changing fundamentals, with profit-taking evident across major European hubs after prices pushed through prior conflict-driven resistance zones.
Benchmark Contract Moves
| Market | Contract | Latest Price | Move | Recent High |
|---|---|---|---|---|
| Eurozone | Dutch front-month | 72.23 euros per MWh | -1.7% | 74.32 euros per MWh (earlier in the week) |
| United Kingdom | NBP front-month | 178.08 pence per therm | -2.7% | Above 183 pence (previous session) |
Hormuz Disruption Sustains Risk Premiums
Even as front-month prices edged lower, risk premia associated with geopolitical tensions remained deeply embedded along the forward curve. Direct military confrontations between U.S. forces and Iran continued to cloud the outlook for global liquefied natural gas (LNG) trade flows.
A second wave of U.S. air strikes on Iranian military assets in the Persian Gulf, combined with Iranian missile attacks on U.S. facilities in Jordan, has “effectively choked off commercial navigation through the Strait of Hormuz.” Satellite-based vessel-tracking data shows that commercial tanker traffic through the critical waterway is running at only a small fraction of normal pre-war volumes.
The Strait of Hormuz serves as a conduit for about one-fifth of worldwide seaborne LNG shipments, with Qatar as the primary origin for those flows. With that channel severely constrained, European buyers are facing intensified competition from Asian utilities for alternative spot LNG supply from the Atlantic basin, which is helping to keep structural price floors elevated despite the latest round of profit-taking.
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