UK natural gas prices hover at four-month highs, up over 9% this week

⑴ On Friday, UK natural gas prices rebounded above 150 pence per therm, hovering at a four-month high, as escalating US-Iran tensions sparked market concerns over the security of Europe's LNG supply. US forces have carried out strikes on Iran for the 13th consecutive day. US President Trump warned Tehran and Yemen’s Houthi forces that further attacks on Red Sea vessels would face “major military punishment.” ⑵ This week, UK natural gas prices rose more than 9% cumulatively, and have soared over 44% since July, as LNG flows from the Persian Gulf were restricted, intensifying competition with Asian buyers, while Europe’s scorching heatwave boosted electricity demand for cooling. These factors are making it more challenging for Europe to replenish natural gas inventories before winter. Equinor, Europe's largest natural gas supplier, stated that the EU is unlikely to achieve its 80% storage target before the heating season, making the market more vulnerable to sharp price fluctuations when cold weather arrives.