FX.co ★ European Gas Extends Rally

European natural gas prices rose above €76/MWh on Wednesday, advancing for a fourth consecutive session to reach their highest level since December 2022. The rally came as ongoing unrest in the Middle East intensified fears of additional supply disruptions. On Tuesday, the US military reported destroying five Iranian oil tankers near Kharg Island in response to attacks on its warships, prompting Tehran to strike US targets in Jordan. Meanwhile, Iran-backed Houthi militants in Yemen launched drones and missiles at energy infrastructure in southern Saudi Arabia. Together, these developments have highlighted growing obstacles to restoring normal commercial traffic through the Strait of Hormuz. Prolonged disruptions have already compelled Qatar to halt shipments and extend force majeure on cargoes to Europe and Asia through the autumn. The resulting decline in LNG deliveries has slowed gas storage injections in Europe, keeping inventories below their seasonal average and leaving the market increasingly exposed as the winter heating season approaches.