Natural Gas and Oil Analysis: WTI Gains Nearly 2% Amid Supply Concerns and Geopolitical Tensions

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Published: Jan 11, 2024, 13:33 GMT+00:00

Geopolitical tensions in the Red Sea and UN resolution criticism impact oil prices, while Natural Gas faces bearish pressure at $2.72.

In this article:

Natural Gas

+2.28%

WTI Oil

+1.23%

Brent Oil

+1.17%

Key Insights

Geopolitical tensions boost crude oil prices; Yemen’s Houthis criticize UN resolution.
Natural Gas encounters bearish pressure at $2.72 amid short-term trend.
USOIL consolidates in symmetrical triangle; UKOIL bears cautious below $78.

Quick Fundamental Outlook

Concerns over potential supply disruptions in the Red Sea, following Yemen’s Houthis’ criticism of a UN resolution, are driving up crude oil prices. The UN Security Council demanded Houthi compliance to stop attacks on Red Sea shipping and release the seized vessel, Galaxy Leader.

Yemen’s Houthi leader, Mohammed Ali al-Houthi, labeled the resolution a “political game” and accused the US of international law violations. Meanwhile, the latest Energy Information Administration (EIA) data showed an unexpected increase in US crude oil stocks, putting downward pressure on WTI prices.

Contrarily, the American Petroleum Institute (API) reported a significant decline in crude stocks. These developments are likely to impact USOIL, UKOIL, and potentially Natural Gas prices, as they reflect shifting supply dynamics and geopolitical tensions affecting the oil market.

Natural Gas Price Forecast

Natural Gas Chart

Natural Gas (NG) is currently trading at $2.72, down by 2.40%. The pivot point for today is set at $2.83, with resistance levels identified at $2.98, $3.12, and $3.22. Support levels are positioned at $2.72, followed by $2.59 and $2.48. The 50-Day Exponential Moving Average (EMA) is currently at $2.79, suggesting that NG’s price is below this average, reinforcing a short-term bearish trend.

Chart analysis indicates an upward trendline providing support for NG around the $2.72 level. This technical formation suggests that if NG holds above $2.72, it might exhibit bullish behavior.

In conclusion, NG’s trend appears to be bullish above the $2.72 mark. The asset is expected to test its resistance levels in the short term, particularly around $2.72, which will be crucial in determining its immediate direction.

WTI Oil Price Forecast

WTI Price Chart

USOIL is currently trading at $72.31, reflecting an increase of 1.89%. The day’s pivot point is $72.96, with resistance levels at $73.97, $74.99, and $76.10. Support is established at $71.62, with further levels at $70.47 and $69.27.

Chart analysis reveals a symmetrical triangle pattern, confining USOIL within a range between approximately $73 and $70.50. This pattern indicates a consolidation phase, with a potential breakout in either direction.

In summary, the outlook for USOIL is tentatively bearish below the $73 level, with near-term price movements likely to test this key resistance.

Brent Oil Price Forecast

UKOIL Price Chart

UKOIL shows an upward movement, currently trading at $77.79, a 1.79% increase. The pivot point is marked at $78.05, with immediate resistance levels at $79.22, $80.39, and $81.44. Support levels are identified at $76.48, $75.19, and $73.97.

Chart analysis reveals a symmetrical triangle pattern, confining UKOIL within a narrow range between $78.60 and $76.50. This pattern suggests a period of consolidation with potential for a breakout. The overall trend for UKOIL is cautiously bearish below the $78 level.

About the Author

Arslan Aliauthor

Arslan is a finance MBA and also holds an MPhil degree in behavioral finance. An expert in financial analysis and investor psychology, Arslan uses his academic background to bring valuable insights about market sentiment and whether instruments are likely to be overbought or oversold.