EUROPE GAS-Prices rise as US-Iran fighting flares

President Trump reports attacks on U.S. Navy destroyers in Strait of Hormuz

Iran accuses U.S. of ceasefire violations and attacks on civilian areas

Further price adjustments expected owing to U.S.-Iran tensions

- Dutch and British wholesale gas prices rose on Friday morning after U.S. and Iranian forces clashed in the Gulf and the UAE came under renewed attack, endangering a month-old ceasefire and shaking hopes for a diplomatic solution to the crisis.

The benchmark Dutch front-month contract at the TTF hub TFMBMc1 edged up by 0.90 euros to 44.46 euros per megawatt hour (MWh), or $15.31/mmBtu, by 0821 GMT, ICE data showed.

The British front-month contract NGLNMc1 was up 2.09 pence at 108.96 pence per therm.

"We expect the gas contracts to adjust higher today on further attacks between the U.S. and Iran," said LSEG analyst Saku Jussila.

President Donald Trump said on Thursday that three U.S. Navy destroyers were attacked as they moved through the Strait of Hormuz, a conduit for about a fifth of the world's oil and liquefied natural gas flows, which Iran has all but closed since the conflict started.

Meanwhile, Iran's top joint military command accused the U.S. of violating the ceasefire by targeting an Iranian oil tanker and another ship. It also accused the U.S. of carrying out air attacks on civilian areas on Qeshm Island in the strait and nearby coastal areas. The military said it responded by attacking U.S. military vessels east of the strait and south of Chabahar port.

Residential gas demand for heating is expected to rise by 49 gigawatt hours per day on the day ahead to 1,262 GWh/d owing to slightly cooler weather. The weekend forecast is up 50 GWh/d at 969 GWh/d and working days next week are forecast to rise by 46 GWh/d to 1,456 GWh/d, LSEG data showed.

Gas demand for power generation is expected to drop by 67 GWh/d on the day ahead to 2,223 GWh/d despite the temperature drop because wind power output is expected to more than double over the weekend, LSEG data showed.

In the European carbon market, the benchmark contract CFI2Zc1 was up 2 euro cents at 75.15 euros a metric ton.