Europe gas prices tumble on pause in US-Iran fighting

Oil prices also fell sharply, reflecting "the market's desperation for positive news," analysts at ING said in a morning note.

"While this is the first tangible signal of de-escalation, the reasons behind it are less clear," they said, adding the pause in fighting has not yet led to any meaningful pickup in vessel flows through the Strait of Hormuz.

Ship traffic through Bab el-Mandeb fell on Sunday after Yemeni Houthis attacked Saudi oil installations along the Red Sea coast, while transit through the Strait of Hormuz stayed low over the weekend, shipping data from Kpler showed on Monday.

None of the vessels passing through Hormuz carried LNG, according to the data.

In a tight LNG market, arrivals to north north-west Europe were at a "remarkably low level" of 400 million cubic metres (mcm) last week, with a slight recovery to 600 mcm expected next week, said LSEG analyst Ulrich Weber.

EU gas storage sites were last 55.35% full, just 0.6 percentage points off their historic low for the time of year seen in 2021, Gas Infrastructure Europe data showed.

Meanwhile, flows of pipeline gas from Norway were steady at around 321 mcm per day, data by infrastructure operator Gassco showed.

In the European carbon market, the benchmark contract CFI2Zc1 was up €0.20 at €83.60 per metric ton.

Benchmark Dutch and British wholesale gas price fell sharply on Monday morning after the U.S. and Iran paused strikes over the weekend, lifting hopes that energy shipping traffic through the Strait of Hormuz may resume.

The benchmark Dutch front-month contract at the TTF hub TFMBMc1 plummeted by €4.69 to €58.89 per megawatt hour (MWh) by 0735 GMT, ICE data showed.