Natural Gas and Oil Forecast: OPEC+ Output Cuts Extended, Demand Concerns Dominate 2024 Outlook

Market Overview

Oil prices edged lower as geopolitical tensions and weak global demand overshadowed market sentiment. OPEC+ postponed planned output increases to April 2024 and extended production cuts until 2026, citing sluggish demand, particularly in China, and rising supply from non-OPEC producers.

Despite a surprise drawdown in U.S. crude stockpiles, analysts project an oversupplied market in 2025, with non-OPEC supply growth expected to outpace demand. Macquarie estimates a surplus exceeding 1 million bpd next year.

The Federal Reserve’s upcoming rate decision and softening U.S. dollar are being closely watched, as they may influence demand forecasts and provide clarity for oil markets.

Natural Gas Price Forecast

Natural Gas (NG) prices slipped to $3.01, down 0.66%, reflecting bearish momentum as the commodity hovers below the key pivot point at $3.09. Technical analysis suggests further downside pressure, especially after an upward trendline saw a bearish breakout. Immediate resistance stands at $3.13, with additional hurdles at $3.19 and $3.26.

On the downside, support levels are positioned at $3.04, $2.98, and $2.93. The 50-day EMA at $3.08 indicates near-term resistance, while the 200-day EMA at $3.15 underscores the bearish sentiment. Traders should monitor the $3.09 level closely, as a break above could revive bullish momentum.

However, a sustained move below $3.04 may signal a continuation of the sell-off. Short-term sentiment remains cautious.

WTI Oil Price Forecast

U.S. crude oil (USOIL) is trading at $68.33, marginally down 0.05% as it struggles to break above its pivot point at $68.58. The technical outlook leans bearish, with immediate resistance at $69.05, followed by $69.38 and $69.66.

On the downside, key support levels are $67.97, $67.68, and $67.36, highlighting potential areas for price stabilization. The 50-day EMA at $68.71 and the 200-day EMA at $68.96 suggest a bearish sentiment, reinforcing resistance near $68.58.

Traders should watch for a decisive move above this level to signal bullish momentum, while a break below $67.97 could deepen the sell-off.

Brent Oil Price Forecast

Brent crude (UKOIL) is trading at $72.05, slipping 0.12% as it hovers below its pivot point at $72.38. The technical setup remains bearish, with immediate resistance at $72.84, followed by $73.25 and $73.58.

On the downside, key support levels are positioned at $71.73, $71.26, and $70.79, which could serve as potential areas of stabilization.

The 50-day EMA at $72.48 and the 200-day EMA at $72.72 reinforce the bearish tone, as prices struggle to breach these levels. A decisive break above $72.38 could revive bullish momentum, targeting $72.84, while a fall below $71.73 may signal deeper declines.