European natural gas futures dropped more than 5% to €50.6 per megawatt-hour on Wednesday, following a nearly 60% surge over the prior two sessions, after reports that Iran may be willing to discuss ending the Middle East conflict that has shaken energy markets. While the offer raised hopes, US officials remain skeptical that either side is ready for a short-term resolution. The world’s largest LNG plant in Qatar remains offline, and the Strait of Hormuz is largely closed, stoking fears of a major supply shock. European supplies have not yet been directly affected, as shipments scheduled for March are already en route, but the continent remains vulnerable with storage levels low and large volumes needed to refill reserves this summer. Traders are also monitoring potential tanker diversions to Asia or Egypt, heightening market uncertainty amid an ongoing crisis with no clear ceasefire.
