Natural Gas and Oil Forecast: Will Bearish Momentum Continue With Weak U.S. Demand?

Market Overview

Oil prices extended their losses due to expectations of increased OPEC+ production starting in October and concerns about weakening demand in China and the U.S., the world’s largest oil consumers.

OPEC+ plans to raise output by 180,000 barrels per day, which could pressure prices further. Meanwhile, disappointing manufacturing data from China and sluggish U.S. oil consumption are adding to the bearish sentiment.

The continued decrease in oil prices, coupled with global economic concerns, also negatively impacts the natural gas market, with downward pressure expected in the short term as energy demand weakens across the board.

Natural Gas Price Forecast

Natural Gas (NG) is trading at $2.165 with an immediate resistance to watch is at $2.20, followed by $2.23 and $2.28. If NG can push through these levels, we could see a continuation of the upward trend.

On the downside, the first line of support lies at $2.09, with additional supports at $2.04 and $2.00. It’s also worth noting that NG is trading above its 50-day and 200-day EMAs, which are closely aligned around $2.10 and $2.11.

This alignment adds a layer of support to the bullish scenario, but a break below $2.16 could shift the momentum towards a bearish trend.

WTI Oil Price Forecast

U.S. Oil (USOIL) is currently trading at $73.02, reflecting a decline of 0.84%. The price action suggests some bearish momentum, particularly as USOIL is now trading below both its 50-day Exponential Moving Average (EMA) of $74.80 and its 200-day EMA at $75.37.

These EMAs are key indicators, and trading below them often signals a potential continuation of the downward trend.

A critical level to watch is the pivot point at $72.93. If USOIL manages to stay above this level, there’s a chance for the price to find support and possibly push towards the immediate resistance at $74.05.

However, if the price drops below $72.93, we could see a more significant sell-off, with the next support levels at $72.24 and $71.44 coming into play.

Brent Oil Price Forecast

Brent Crude (UKOIL) is currently trading at $76.37, down 0.92%. The price action suggests some weakness, especially since UKOIL is trading below both its 50-day Exponential Moving Average (EMA) at $78.20 and its 200-day EMA at $78.98. These EMAs are crucial indicators, and staying below them typically signals a bearish trend.

The key level to watch is the pivot point at $76.72. If UKOIL can hold above this level, there’s potential for the price to rebound towards the immediate resistance at $77.74. However, if the price breaks below $76.72, it could trigger further selling pressure, with the next support levels at $75.60 and $75.01 becoming the focus.

Overall, while the current momentum leans bearish, staying above the $76.72 pivot point could offer a glimmer of hope for a recovery. But, given the technical indicators, a cautious approach is advisable.