NATGAS: Gas Summary at European Close: TTF Falls

Secretary of Iran's Supreme National Security Council, Ali Larijani, indicates that any de-escalation in the Middle East is unlikely to be achieved by countries viewed as close to the US or Israel, referring to European nations. Larijani posts on X: "It is unlikely that any security will be achieved in the Strait of Hormuz amid the fires of the war ignited by the United States and Israel in the region, especially if that is by the design of parties that were not far removed from supporting this war and contributing to its fanning." 

• Larijani's comments come in response to French President Emmanuel Macron's statement that French naval vessels would provide security escorts through the Strait of Hormuz for container ships and tankers. Speaking in Cyprus, Macron said he wanted the "purely defensive" operation to begin as soon as possible, adding that this can only happen when the fighting in the Middle East has died down.
• Earlier, European Commission President Ursula von der Leyen and European Council President Antonio Costa held a videoconference with leaders from the GCC states, Turkey, Iraq, Jordan, Lebanon, Armenia, Egypt and Syria. In a joint statement, the two EU leaders said they "expressed their openness to further tailor and enhance" operations Aspides and Atalanta, joint European naval operations initially intended to protect shipping in the region from Houthi rebels in Yemen, in order to better respond to the situation.

• +50,000 TUJ6 105.25 calls, 1.5 ref 104-04.75

OI data suggests that net short setting dominated in Euribor futures on Friday, though some pockets of long cover were still noted in the H6, M6, U7 and Z8 contracts. Futures settled -1.0 to -11.0 ticks through the blues on Friday, with weakness centred in the reds. The red pack also saw the largest one-day OI adjustment (+28k), concentrated in H7 (+23k).

Across the week as a whole, indicative net short setting was seen in the whites while net long cover was prevalent in the reds, greens and blues. Futures finished the week up to 41.0 ticks lower. Markets now assign a material implied probability of 2x25bp hikes this year, after previously pricing a modest implied chance of another cut. 

Daily OI Adjustment On Friday, March 6 (Source: Bloomberg Finance L.P)

Weekly OI Adjustment W/C March 2  (Source: Bloomberg Finance L.P)