Now Reading: European gas prices jump 10% on Hormuz deal doubts
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European gas prices jump 10% on Hormuz deal doubts
European natural gas prices surged more than 10% on Monday after Iran-Oman talks failed to convince traders of a swift reopening of the Strait of Hormuz. Benchmark Dutch front-month futures rose to…
The Story in Brief
European natural gas prices surged more than 10% on Monday after Iran-Oman talks failed to convince traders of a swift reopening of the Strait of Hormuz. Benchmark Dutch front-month futures rose to €61.24 per megawatt-hour. Iran said over the weekend that an agreement was “very close” but signalled it would not immediately restore flows. US President Donald Trump indicated he prefers to let economic pressure build rather than launch fresh military strikes on Iran. Separately, prolonged supply cuts at Norway’s Ormen Lange gas field add to price swings. Europe’s gas storage is at 59%, the lowest seasonal level since records began in 2009 and far below the 76% five-year norm for this time of year. Citigroup strategists warn of sharper demand spikes if El Niño causes extreme cold.
The Indian Opinion
Some analysts are pushing the line that an Iran-Oman deal is almost done, or that US military action is around the corner. Neither matches the facts. Tehran itself says a deal would not immediately reopen the strait, and President Trump is holding back on strikes. What matters is Europe’s gas storage: now at 59% full against a 76% seasonal norm. If storage does not reach at least 74% by end-October, as Citigroup projects only on a mid-August resumption, then the continent will enter winter perilously low. That number will settle the argument.
Source: livemint.com
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