UK natural gas jumps above 154p/therm on supply risks

UK natural gas prices rose above 154 pence a therm on Monday, reaching a fresh three-week high amid continued disruption to LNG supplies from the Gulf as US-Iran negotiations stalled.

Renewed Israeli strikes against Tehran-backed Hezbollah in Lebanon, along with the latest US threats of additional sanctions on Iran, have further clouded prospects for an imminent agreement to reopen the Strait of Hormuz.

Traffic through the waterway has fallen sharply following recent attacks on vessels, highlighting persistent security risks.

For Europe, concerns over gas inventories are becoming increasingly pressing, as storage levels remain below historical averages and are lagging the pace needed to comfortably meet pre-winter storage targets.

Efforts to rebuild inventories have also been hampered by heatwaves across Southern and Central Europe, which have boosted demand for gas-fired power generation, diverting supplies from storage.