Natural Gas and Oil Forecast: Prices React to Saudi Exports and Fed Meeting

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Updated: Jun 11, 2024, 09:44 GMT+00:00

Key Points:

Oil prices retreated due to the anticipation of U.S. inflation data and a key Federal Reserve meeting, despite Monday's temporary rise.
Upcoming U.S. CPI data and Fed outcomes will be crucial in shaping future oil demand and pricing trajectories.
External factors like reduced Saudi crude exports to China and potential U.S. reserve purchases are also impacting oil markets.

Market Overview

Oil prices dipped on Tuesday, influenced by market anticipation of U.S. inflation data and Federal Reserve decisions. While Monday saw a temporary 3% rise in oil prices due to expected summer travel demand, concerns about potential rate hikes loomed, suggesting this increase might be fleeting.

The upcoming release of the U.S. consumer price index and outcomes from the Fed’s meeting are pivotal, as they could dictate future fuel demand and pricing trends.

Factors like lower Saudi crude exports to China and potential U.S. strategic reserve purchases are also influencing market dynamics. For oil, breaking above the $83 level is crucial for a sustained recovery amidst declining trends.

On the other hand, natural gas and oil forecasts remain cautious, waiting for clear economic signals from these major economic events, which could significantly affect pricing and demand in the energy sector.

Natural Gas Price Forecast

Natural Gas (NG) Price Chart

Natural Gas (NG) is currently priced at $3.01, reflecting a gain of 1.09% for the day. The market dynamics are closely tied to the pivot point set at $3.04, which will determine the short-term direction.

The resistance levels are staged at $3.10, $3.17, and $3.25, each representing potential hurdles should the price continue to climb. Conversely, support is established at $2.94, followed by deeper safety nets at $2.86 and $2.79, crucial for cushioning any downward movements.

Technical analysis highlights the 50-day Exponential Moving Average (EMA) at $2.88 and the 200-day EMA at $2.68, both well below the current price, underscoring the recent upward momentum.

While the market remains bullish above $2.95, falling below this threshold could trigger a notable sell-off, emphasizing the importance of monitoring these pivotal levels closely.

WTI Oil Price Forecast

WTI Price Chart

WTI Crude Oil (USOIL) is currently trading at $77.69, marking a decrease of 0.64%. Today’s session reveals a pivot point at $77.50, which is crucial for traders to watch. If prices hold above this level, it may signal continued bullish sentiment.

Immediate resistance levels are set at $78.59, $79.41, and $80.43. These thresholds will test the oil’s upward momentum. Conversely, support levels are established at $76.54, $75.41, and $74.21, providing potential floors where buying interest might resurface.

Technical indicators show the 50-Day Exponential Moving Average (EMA) at $76.00 and the 200-Day EMA at $76.89, both below the current price, suggesting underlying support. A break below the $77.50 pivot could trigger a sharper decline, emphasizing the need for vigilance around this key level.

Brent Oil Price Forecast

Brent Price Chart

Brent Oil (UKOIL) is currently valued at $81.48, showing a decline of 0.48%. The price sits below the day’s pivot point at $82.08, hinting at bearish sentiment in the near term. The immediate resistance levels are found at $82.87, $83.70, and $84.66. These will serve as critical barriers if the price attempts to recover.

Conversely, support levels are placed at $80.66, $79.28, and $78.34, which could provide stability and potential rebound points if the downtrend continues.

The technical setup shows the 50-day Exponential Moving Average (EMA) at $80.06 and the 200-day EMA at $81.25, indicating that current prices are testing these averages. Remaining below the pivot of $82.08 could maintain the bearish pressure, while a push above this mark might signal a shift to a bullish outlook.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Arslan Aliauthor

Arslan, a webinar speaker and derivatives analyst, has an MBA in Finance and MPhil in Behavioral Finance. He guides financial analysis, trading, and cryptocurrency forecasting. Expert in trading psychology and sentiment.