Dutch and British gas contracts rose on Tuesday as hopes for a peace deal faded after Donald Trump said a ceasefire with Iran was “on life support” following Tehran’s rejection of a US proposal to end the conflict, and stuck to a list of demands the US president described as “garbage”.
The benchmark Dutch front-month contract at the TTF hub was up €1.16 at €47.39 per megawatt hour (MWh), or $/mmBtu, by 08:23 GMT, data from the Intercontinental Exchange (ICE) showed.
The British contract for June was up 3.42p at 116.85p per therm.
Iran has called for an end to the war on all fronts, including Lebanon, where US ally Israel is fighting Iran-backed Hezbollah militants. Tehran also emphasised its sovereignty over the Strait of Hormuz, demanded compensation for war damage, and an end to the US naval blockade.
“I would call it the weakest right now, after reading that piece of garbage they sent us. I didn’t even finish reading it,” Trump, who has repeatedly threatened to end the ceasefire, told reporters.
This leaves the Strait of Hormuz largely closed with no clear end in sight to the war, analysts at Engie’s EnergyScan said, adding that the short-term momentum is bullish.
The market is closely monitoring Trump’s visit to China on Wednesday, where Iran is set to be among the topics discussed with Chinese President Xi Jinping.
“News around the upcoming US-China summit could also move geopolitical sentiment,” said LSEG analyst Ulrich Weber.
Fundamentally, average temperatures across Northwest Europe will rise 0.9 degrees Celsius on Wednesday, but remain overall two-three degrees Celsius below normal.
Gas demand for heating is expected up by 78 gigawatt hours per day on the day ahead at 1804 /d and weekend demand is up 100 /d at 1642 /d, LSEG data showed.
(Reporting by Marwa Rashad; Editing by Sonia Cheema)
