Natural Gas and Oil Forecast: Weak Chinese Demand and Technical Barriers Weigh Heavily

Market Overview

Oil prices fell by 3% during Asian trading, driven by weakening demand and a media report indicating that Israel may avoid targeting Iranian oil infrastructure, easing supply disruption fears. The drop followed a 2% decline on Monday, nearly erasing last week’s gains, which had been fueled by concerns over geopolitical tensions.

While OPEC lowered its global oil demand growth forecast for 2024, citing weaker Chinese demand, oil prices remain supported by ongoing geopolitical risks. The easing of immediate geopolitical threats might provide temporary relief for oil and natural gas prices, but demand outlook remains a key driver for both commodities.

Natural Gas Price Forecast

Natural Gas (NG) is trading at $2.74, down 0.29%, after facing resistance at the $2.66 level. The market is showing a bearish bias below the pivot point of $2.53.Immediate resistance lies at $2.60, with stronger resistance ahead at $2.66 and $2.72, where the 200-day EMA is positioned.

On the downside, immediate support is at $2.44, with additional levels at $2.38 and $2.31. The 50-day EMA at $2.61 is adding pressure on the price, keeping the short-term outlook cautious.

If prices fail to reclaim $2.53, further downside could be likely, while a break above this level could shift momentum toward a more bullish trend.

WTI Oil Price Forecast

USOIL is trading at $71.56, down 0.52%, and testing key support levels. The immediate support lies at $70.63, with additional support at $69.91 and $68.91. Oil is facing resistance at $73.45, with the 50-day EMA sitting just above at $73.93, adding pressure.

The 200-day EMA at $72.64 suggests a longer-term trend favoring downside momentum, but if prices push back above $72, we could see a bullish correction.

Traders should watch for a break above $72, as it could shift the trend upward toward resistance at $74.79 and $76.20. Conversely, if support fails, further declines are likely, with sharp selling pressure below $70.

Brent Oil Price Forecast

UKOIL is trading at $75.09, up slightly by 0.03%, but facing resistance ahead. The key pivot point stands at $75.54, and the immediate resistance sits at $76.85, with further targets at $78.06 and $79.47.

However, a symmetrical triangle pattern hints at the possibility of a continued downtrend. Support lies at $74.34, with additional levels at $73.56 and $72.69. The 50-day EMA at $77.50 and the 200-day EMA at $76.12 are creating barriers for any immediate bullish move.

The technicals suggest that staying below $75.54 could maintain bearish pressure, while breaking above it may shift momentum to the upside. Keep an eye on the $75.54 level—it’s the critical line in the sand.