European natural gas extended last week's gains as a recent vessel attack near the Strait of Hormuz heightened concerns about low storage and fragile winter supplies. According to Sina Finance, benchmark futures rose as much as 2% on Monday morning, reaching their highest level since December 2022. The United Kingdom Maritime Trade Operations received a report that an LNG carrier was attacked near Yemen on Saturday, fueling concern that Middle East gas flows could shrink further.

Europe is approaching winter with storage at seasonally low levels and must compete with Asia for limited global LNG supplies. If gas flows remain disrupted, prices could surge again.

Mild temperatures early in Europe's heating season allowed energy companies to refill storage faster than usual for October. Even so, storage was just above 74% full, well below the five-year average of 89% for this point in the season.