European Gas Prices Firm as Hormuz Shipping Risks Surge

Key Moments

European Gas Contracts Tick Higher

European wholesale natural gas prices moved moderately higher on Monday, as reports of new attacks on commercial vessels near the Strait of Hormuz raised fresh questions over supply security and countered relief from U.S. President Donald Trump’s conditional halt on additional military strikes against Iran.

The benchmark Dutch Title Transfer Facility (TTF) front-month contract advanced 1.4% to 86.70 euros per megawatt-hour in morning dealings. In the UK market, the National Balancing Point (NBP) front-month contract rose 2% to 217 pence per therm.

The uptick in prices followed a weekend marked by conflicting geopolitical developments that left energy traders reassessing the short-term risks to gas flows transiting the Persian Gulf.

Mixed Signals From Washington and Tehran

Market participants initially found some comfort after President Trump said on Sunday that he was highly unlikely to authorize new strikes on Iran as long as diplomatic efforts aimed at resolving the regional conflict continued to make headway.

The comments signaled a softening in tone from earlier remarks, when the U.S. president had alluded to the possibility of renewed military action in the wake of last week’s U.S. midterm elections. So far, there has been no evidence of a large-scale American military campaign, while Iran has continued to project a strong deterrent stance, warning that it would target U.S. and Israeli interests if attacked.

The more conciliatory messaging was soon overshadowed by developments at sea. Authorities from both the U.S. and Iran reported that commercial vessels were hit in or near the Strait of Hormuz over the weekend.

These incidents underscored the vulnerability of a key shipping corridor for liquefied natural gas and crude oil, encouraging European utilities and hedging desks to return selectively to the market to lock in near-term gas volumes.

Stabilization After a Sharp Energy Market Selloff

Monday’s gains in European gas contracts reflected a tentative recovery after what was described as one of the most severe selloffs in the global energy space.

Over the prior week, Brent crude futures slumped 16%, marking their largest weekly decline since the early stages of the COVID-19 outbreak in 2020. That sharp downward move pulled European gas forward curves lower as well, ending a five-week run of gains for both TTF and NBP. Traders had positioned for the prospect that a split U.S. Congress would limit the administration’s military flexibility and push events toward a negotiated outcome.

Despite Monday’s rebound, the broader backdrop for energy remains decisively bearish after the recent rout. Even so, the session’s focused buying activity underlined how quickly European gas pricing can react to any signs of physical disruption in the Middle East as the Northern Hemisphere approaches the peak period for winter consumption.