Quantum transits
The EU gas market is pricing two mutually exclusive Hormuz states at once. Energy Flux’s new model quantifies the disconnect between price-implied LNG flows and physical reality in the contested Strait. Either missing cargoes return, or TTF moves higher.
The European gas market is not ignoring the de-facto closure of the Strait of Hormuz. It is doing something stranger: pricing a high-confidence bet that the chokepoint will substantially reopen before the disruption does lasting damage.
The disconnect between commodity pricing and Hormuz vessel movements has been visible for months. The harder question is how wayward the market’s bet on a swift resolution has become.
In natural gas, how much assumed Hormuz recovery is implicitly priced into front-month TTF, Europe’s benchmark contract? How much missing LNG is the market effectively assuming will return? And how far would TTF have to re-rate if that assumption breaks?
Energy Flux has built a new interactive framework to answer those questions.
The TTF Hormuz Pricing Model back-solves the amount of Hormuz LNG throughput implied by the TTF price, then shows how that implied belief has moved since the waterway was operationally closed.
The model rests on two user-defined bookends: one fair-value TTF price for durable reopening, and another for sustained closure.
It does not tell you what to believe. It shows you what the price requires you to believe, based on your own assumptions.
Under Energy Flux’s default settings, the result is stark: front-month TTF is priced as if the vast majority of pre-war Hormuz LNG flow is still economically available to the market, even though observed transit is running at barely 2–3% of normal. The implied figure has varied since the outbreak of hostilities, but it has consistently sat far above the amount of LNG physically moving through the Strait.
Only seven laden LNG vessels have crossed Hormuz east since the war began on 28 February 2026, against a pre-war pace of around one hundred a month from Qatar and the UAE combined. There is little movement, and scant volume.
The geopolitical signal is just as confused. Washington is briefing progress towards a ceasefire extension, de-mining and a reopening of commercial traffic. At the same time, US forces this week resumed striking targets in southern Iran.
The peso problem
So, which is it? Are we days away from a comprehensive deal that reopens the Strait? Or one direct drone strike away from a wider war that closes Hormuz indefinitely?
The honest answer is: both, simultaneously. TTF cannot price them separately, so it blends them into a single number. That number looks precise. But it does not correspond to a plausible physical state of Hormuz transits.
That is the ‘peso problem’ in textbook form. When traders face binary outcomes with uncertain timing, the equilibrium price becomes a probability-weighted blend of two bookends. It looks logical. It is actually a compressed spring.
The TTF front-month is currently trading around €47/MWh. That price sits somewhere between ‘Hormuz reopens tomorrow’ fair value and ‘Hormuz remains closed indefinitely’ fair value. Where it sits between those bookends reveals the market’s implied bet on resolution.
The full model below lets subscribers put a number on that wager. It back-solves the Hormuz LNG flow implied by the TTF price, compares it with observed vessel transit, and translates the gap into tonnes per week of missing supply.
Move the reopening and closure bookends, test your own fair-value assumptions, and see exactly how much phantom LNG is embedded in the current price.
💥 Article stats: 3,000 words, 12-min reading time, 2 charts, 1 interactive data model
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