Natural Gas and Oil Forecast: China’s Weaker Demand Weighs on Prices – What’s Next?

Market Overview

Natural gas and crude oil prices are under pressure as geopolitical tensions create volatility in the energy markets. The outlook remains uncertain due to weak demand signals from China, the world’s second-largest oil consumer, where apparent oil demand fell nearly 7% in September.

An increase in global oil supply is also weighing on prices, as Libya’s crude production rose to its highest in two months, boosting worldwide availability.

Meanwhile, lingering concerns over geopolitical risks and reduced Russian exports are likely to keep the market on edge, sustaining a cautious tone among investors despite a weaker dollar offering slight support to energy prices.

Natural Gas Price Forecast

Natural Gas (NG) trading around $2.63, hinting at potential volatility ahead. The 4-hour chart shows a downward trendline, suggesting resistance near $2.30. This is a crucial pivot point, and if prices dip below this level, immediate support stands at $2.23, with subsequent levels at $2.17 and $2.12.

On the upside, breaking through $2.30 could push prices toward the next resistance targets at $2.38 and $2.45, and possibly $2.50. Technical indicators are reinforcing this cautious outlook.

The 50-day Exponential Moving Average (EMA) is at $2.41, while the 200-day EMA is positioned at $2.56, both indicating ongoing bearish pressure. For now, traders should watch for a decisive move above $2.30 to signal a shift in sentiment.

WTI Oil Price Forecast

US crude oil (USOIL) trades at around $68.75, hovering near key technical levels. The 4-hour chart suggests that $69.19 acts as a critical pivot point. A break above this level could trigger upward momentum, targeting resistance at $70.51 and beyond, with further levels at $71.65 and $72.68.

However, if prices dip below immediate support at $67.67, downside risks increase, with the next support levels sitting at $66.36 and $65.26.

The 50-day EMA at $70.74 and 200-day EMA at $71.78 are both sloping downwards, hinting at continued bearish pressure. If USOIL fails to clear $69.20 convincingly, the overall sentiment remains cautious. Keep an eye on price action near these EMAs for confirmation of any trend changes.

Brent Oil Price Forecast

Brent Crude (UKOIL) is trading at $73.14, down 1.71% in today’s session. Prices are lingering below the key pivot level of $73.42, which is acting as a short-term resistance point.

A break above this level could shift momentum toward the upside, targeting resistance levels at $74.85, $75.94, and eventually $76.85. On the downside, immediate support sits at $71.92, with further support at $70.89 and $69.89.

Technical indicators are reinforcing the cautious outlook. The 50-day EMA stands at $74.74, while the 200-day EMA hovers at $75.45, both signalling a bearish trend. As long as prices stay below the pivot point, the sentiment remains skewed towards the downside. A break above $73.42 could, however, trigger a shift in momentum.