European Natural Gas Prices Rise as Strait of Hormuz Talks Stall

TLDR

• European natural gas futures rose over 2% on Monday, with Dutch contracts up 2.9% to around €56.90/MWh
• Iran and Oman have not reached a final deal on shipping lanes through the Strait of Hormuz
• Tehran insists the waterway will only fully reopen once additional U.S. conditions are met
• EU gas storage sits at roughly 56% capacity, lagging historical averages for mid-August
• Competition with Asian buyers for spot LNG cargoes is keeping supply balances tight

European natural gas prices bounced back on Monday as hopes for a quick resolution to Strait of Hormuz shipping disruptions faded. Dutch front-month futures climbed 2.9% to around €56.90 per megawatt-hour. British wholesale contracts also rose 2.6% to 139.50 pence per therm.

The gains came after Iran signaled that a deal with Oman over new shipping channels in the strait was close, but then added conditions that pushed a full reopening further away. Tehran said the waterway would only reopen once extra U.S. demands were met. Iran also ruled out direct talks with Washington.

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