European natural gas prices are rising, influenced by the conflicting signals in the Strait of Hormuz.

At a time when tensions in the Strait of Hormuz and the U.S. seizure of an Iranian ship have weakened hopes for a diplomatic solution in the Middle East, natural gas prices in Europe have risen by over 4%. The benchmark Dutch TTF natural gas futures contract for the near month rose by 4.7% to 40.60 euros per megawatt hour, after previously dropping significantly on news of the opening of the Strait of Hormuz on Friday. However, Iran later stated that it would once again close the strait and restrict shipping until the U.S. lifts its blockade on Iranian ports. Analysts at ANZ Bank stated, "Contradictory information from Iran has exacerbated the confusion, keeping the market on edge." Nevertheless, the price increase has been limited. Despite Europe continuing to compete with Asia for liquefied natural gas shipments to rebuild depleted gas inventories, relatively weak demand in Asia has helped alleviate supply pressures in Europe.