Investing.com – European natural gas prices edged lower on Friday, as investors kept tabs on conflicting messages around peace talks to end the war in Iran, as well as an anticipated rebound in Norwegian supply levels.
By 08:42 ET (12:42 GMT), was down by 3.1% at 47.860 euros per megawatt hour, according to ICE data.
also fell by 3.6% to 116.44 pence per therm.
Iran’s foreign minister has met with the interior minister of Pakistan, with the discussions focused on bridging key divides between the U.S. and Tehran over peace proposals, Iranian media reported.
The gathering comes two days after Pakistan presented Iran with the latest U.S. message in the negotiations, Reuters reported, citing the semi-officials Tasnim and ISNA news agencies. Islamabad has frequently acted as a mediator between the U.S. and Iran. According to ISNA, Pakistan’s Interior Minister Syed Mohsin Naqvi is attempting to forge a framework for ending the war and resolving differences between both sides.
U.S. Secretary of State Marco Rubio said discussions have shown “good signs” of progress, although he flagged that he did not want to be “overly optimistic” and was waiting to “see what happens over the next few days.” Meanwhile, a senior Iranian official quoted by Reuters said that gaps in negotiations have narrowed.
Washington and Iran are now locked in a protracted ceasefire that has lasted longer than the initial phase of bombardments which began in late February. The U.S. and Israel initially launched a joint assault of Iran, sparking a bout of retaliatory attacks that spread to other areas in the Middle East, including large energy-producing countries in the Gulf region.
Crucially, the stalemate has left the Strait of Hormuz all but shuttered for weeks. A narrow waterway off of Iran’s southern coast, the strait is a vital conduit through which roughly a fifth of the world’s oil and liquefied natural gas squeezes. The closure, along with attacks on key production facilities in the Gulf, have lifted natural gas prices sharply since the start of the conflict.
However, analysts at ING noted that “European natural gas prices are remarkably well-behaved,” adding that “[e]ven if they rise, as our commodities team warns they might, we’re still unlikely to get anywhere near the scale of 2022” — a year marked by an energy shock caused by the outbreak of the war in Ukraine.
Beyond the war, downward pressure on prices came from Norway, where gas supplies are anticipated to gradually return following a recent round of maintenance, analysts cited by Reuters suggested.
Still, gas storage sites in the European Union were last 37% full, versus about 45% a year ago and 65% in 2023 and 2024, according to Gas Infrastructure Europe data. Energy giant has flagged that stock levels could be critically low should the Strait of Hormuz stay closed for an extended period of time.