Dutch prices rise amid LNG concerns due to Middle East tensions

Dutch wholesale gas prices rose on Tuesday afternoon amid growing concerns that an escalation of the Iran-Israel conflict is impacting the loading and shipment of liquefied natural gas (LNG), tightening the market.

The benchmark Dutch front-month contract at the TTF hub rose by €1.28 to €38.73 per megawatt hour (MWh) by 14:54 GMT, according to LSEG data.

The August contract gained €0.76 to €38.90/MWh.

The British contract for August was up by 0.12p at 93.32p per therm.

The gains were all driven by the events in the Middle East and signs that LNG producers in the region were taking additional cautionary measures, a trader said.

Qatar has said gas production at the world's largest gas field, South Pars, is steady after it was hit by an Israeli airstrike on Saturday.

However, on Tuesday QatarEnergy instructed tankers to remain outside the Strait of Hormuz and to enter the Gulf only the day before loading, sources told Reuters.

Were more producers to make similar statements, prices could rise much higher still, the trader added.

The European Commission also officially proposed legal measures on Tuesday to enact a ban on Russian gas imports, with the aim of halting the EU’s reliance on Russian energy by the end of 2027.

However, an Austrian official said the European Union should be open to resuming Russian natural gas imports in the future if a peace deal is reached between Russia and Ukraine.

The commission proposals are designed so they can pass into law with the approval of a reinforced majority of countries, meaning one or two could not block them.

(Reporting by Nina Chestney in London and Nora Buli in Oslo; Editing by Susan Fenton)