European gas prices rise amid Middle East peace-deal uncertainty

European natural gas prices rose to €68.5/MWh on Friday, extending gains from the previous session and moving back toward their highest level since January 2023, as supply risks remain amid uncertainty over a Middle East peace deal.

Prices jumped on Thursday after reports that President Trump was not interested in returning to the terms of a June deal with Iran.

This reversed losses from earlier this week, which were driven by progress in talks between Pakistan and Iran to end the conflict, as well as an agreement between Iran and Oman on control and revenues tied to the Strait of Hormuz.

The near-closure of the Strait has continued to disrupt LNG supplies from Qatar, while heatwave-driven cooling demand diverted supplies from storage.

These factors have left Europe scrambling to secure supplies, heightening fears that the region could enter the winter heating season with insufficient reserves.

For the week, European gas prices climbed more than 3%, the third straight weekly gain.