European Gas Prices Poised for Quarterly Decline
The front‑month Dutch TTF contract, the benchmark for European wholesale natural gas, rose 2 % on the day to €43.44 per megawatt‑hour, positioning it for its first quarterly decline in six quarters. Britain’s equivalent wholesale gas contract also gained 2 % to 104.57 pence per therm, on track for its first quarterly drop in five quarters.
Drivers of the Price Reversal
The downward shift follows a sharp retreat in global crude‑oil benchmarks, which have returned to pre‑war equilibrium levels, removing the cross‑commodity support that previously kept European gas prices elevated. In addition, maritime traffic through the Strait of Hormuz has normalised after a brief flare‑up in attacks on ships that slowed traffic last week; a diplomatic cease‑fire agreed earlier this month allowed delayed LNG vessels from key exporters such as Qatar and the United Arab Emirates to resume their routes to international hubs. The United States and Iran are scheduled to meet in Doha for renewed talks.
Storage Constraints Limiting Further Losses
Despite the quarterly decline, traders note that further downside may be capped by tight physical market conditions. European gas storage is currently under 48 % of capacity, down from 56.2 % at the same point last year and below the historic five‑year injection average of 61 %, indicating limited buffer for additional price reductions.