Natural Gas and Oil Forecast: Will Geopolitical Tensions Keep Prices Elevated?

Market Overview

Oil prices climbed on Thursday, driven by concerns over tightening global supply amid heightened geopolitical tensions and potential weather disruptions in the Gulf of Mexico.

Despite the U.S. dollar reaching a near four-month high, which typically pressures commodity prices, these supply fears outweighed currency headwinds.

Analysts note that further constraints on oil flows, alongside expected production increases from OPEC in early 2024, may create a complex, short-term forecast for the energy markets.

Meanwhile, rising U.S. crude inventories add to the volatility, with the Energy Information Administration reporting a 2.1 million-barrel increase last week.

Natural Gas Price Forecast

Natural Gas (NG) prices are showing resilience at $2.83, up 0.78%, as they hold above a crucial support level at $2.72. This level aligns with both the 50-day EMA ($2.72) and the 200-day EMA ($2.68), reinforcing the bullish sentiment.

Immediate resistance sits at $2.77, with stronger levels above at $2.82 and $2.86. A sustained move above these points could indicate further upward momentum. On the downside, if prices break below $2.72, we may see increased selling pressure, with support levels at $2.67, $2.62, and $2.57 potentially coming into play.

For now, natural gas appears poised for gains as long as it holds above $2.72, supported by a bullish trendline.

WTI Oil Price Forecast

USOIL (WTI) is trading at $72.08, up 0.39%, showing signs of a cautious uptrend. Prices are comfortably above the pivot point at $71.61, suggesting a supportive tone. Immediate resistance sits at $72.60, with additional hurdles at $73.18 and $73.69 if momentum builds.

On the downside, support is firm around $70.70, with further cushions at $70.20 and $69.73. The 50-day EMA at $71.15 and the 200-day EMA at $70.62 both lie below the current price, reinforcing a bullish outlook as long as oil stays above $71.61.

In summary, WTI appears to have upward potential, but a close below $71.61 could trigger a reversal.

Brent Oil Price Forecast

Brent crude (UKOIL) is trading at $75.39, down slightly by 0.27%, but it’s hovering above its pivot point at $74.92, indicating a cautiously bullish stance. Immediate resistance lies at $75.55, followed by $76.08 and $76.49 if prices manage to push higher.

On the downside, support begins at $74.34, with additional levels at $73.92 and $73.32. The 50-day EMA aligns closely with the pivot at $74.90, while the 200-day EMA sits at $74.17, both adding a cushion to the current price.

In short, as long as Brent holds above $74.92, the trend leans bullish. However, a dip below this level could signal further downside.