Natural gas is falling. No change in the Middle East
The price of natural gas in Europe stays near the highest level in a month, while investors continue to assess the chances of restarting LNG supplies from the Middle East.
In the second half of the week, gas prices slightly fell after four months of conflict between the United States and Iran.
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As Bloomberg reminds, limited supply means Europe must compete more with other global buyers for available deliveries.
At the same time, countries in the region must intensively replenish gas stocks before the coming winter, while dealing with periods of high temperatures.
"Gas storage in the region is at a lower fill level than usual for this time of year – across the European Union they are only 51% full, while the seasonal average is 65%. In Germany the fill level is just over 43%", the agency said.
The escalation of tensions between Washington and Tehran seems endless, especially since the parties have so far conducted a series of talks aimed at ending hostilities.
Recent information indicates that two LNG tankers have entered the Gulf of Oman, which in practice could mean a potential loading of cargo from the Persian Gulf area.
"It is not clear, however, how quickly flows from the Middle East can be restored after U.S. forces carried out the second day of attacks on targets in Iran", Bloomberg says.
CNN confirms that U.S. forces struck 90 targets along the Iranian coast.
In response, the Iranian Revolutionary Guard attacked U.S. military bases in Kuwait and Bahrain and a U.S. military facility in Qatar.
Donald Trump warned against escalating strikes, reinforcing investors' belief that there will be no breakthrough in the Middle East soon.
Moreover, on July 9 the funeral ceremonies for Iran's Supreme Leader Alejandro Chameneio are concluding.
"All eyes are on whether his son and successor Mojtaba will appear", CNN reports.
Source: Bloomberg.
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Natural gas price in Europe on Thursday, July 9
The futures contract price for natural gas in Europe on Thursday, July 9 fell by 1% to a level of 48,7 EUR per MWh.
"The situation in the European gas market still seems tense as the storage season progresses", analysts at ING Think said.
"The latest escalation of tensions only amplifies concerns about shortages, especially as Europe approaches the heating season", they added.
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Chart. Futures contract price for natural gas in Europe
Source: Trading Economics.
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Sources: Bloomberg, CNN, ING Think.
