European gas hits 3.5-yr high as Gulf tensions escalate

This marks a notable convergence of geopolitical risk and structural tightness in European energy markets. The sustained rally, now at multi-year highs, signals that the market is pricing in a credible threat to supply routes, not just a transient spike. With inventories already low, the margin for error is thin, making the market highly sensitive to any further escalation or diplomatic de-escalation. The key question is whether this price level reflects a new risk premium that persists, or if it corrects sharply once the immediate Gulf threat is clarified.