European natural gas prices have risen for four consecutive trading sessions as growing geopolitical risks in the Middle East fueled fears over fuel supplies, UNN reports citing Bloomberg.
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Benchmarks for September delivery rose 2.2% on Wednesday, settling at a five-week high for the contract as traders worry about their ability to build up stockpiles for the winter.
As noted, Hamas claimed that Israel had killed its political leader in an air strike on Tehran, prompting Iran to respond that it was "seeking revenge." The escalation further exacerbates the situation in the energy-rich region at a time of growing global competition for liquefied natural gas, the newspaper points out.
According to ship tracking data, LNG shipments to Europe in July were about 30% below average. Meanwhile, outages at Norwegian fields further deteriorated the market situation. While the continent's storage facilities are well filled for this time of year, the hot weather is increasing demand for air conditioning.
Gas futures for September closed at 35.87 euros per megawatt-hour on the Title Transfer Facility hub in the Netherlands on July 31.
"The further escalation in the Middle East shows how quickly TTF can jump in a day," said Florence Schmitt, energy strategist at Rabobank.
Chevron Corp. said that its facilities in Israel are fully operational and continue to supply gas to local and regional consumers from the Leviathan and Tamar reservoirs.