Natural Gas and Oil Forecast: Winter Demand Fuels January Oil Gains, Watch Key Pivot Levels

Market Overview

Oil prices dipped for a second consecutive day, weighed down by larger-than-expected U.S. fuel inventory builds. Gasoline and distillate stocks rose by 6.3 million and 6.1 million barrels, respectively, while crude inventories saw a modest draw of 959,000 barrels. Despite this, winter demand and tighter supply concerns limited the decline.

Analysts anticipate a 1.4 million bpd rise in January oil demand, driven by colder Northern Hemisphere weather and China’s Lunar New Year travel. Brent futures’ widening backwardation signals tightening supplies, with traders closely monitoring global demand trends and future U.S. energy policies for further market direction.

Natural Gas Price Forecast

Natural Gas (NG) prices are trading at $3.41, down 0.96% for the day, as bearish momentum dominates after failing to hold above the key pivot point of $3.55. On the 4-hour chart, immediate resistance stands at $3.74, with a stronger hurdle at $3.98.

Meanwhile, support levels are seen at $3.43 and deeper at $3.25, marking critical zones for potential downside moves.

The 50 EMA aligns closely with the pivot point at $3.55, reinforcing it as a key level for trend shifts. The 200 EMA at $3.19 underscores a strong long-term support level. RSI readings indicate neutral momentum, but a sustained move below $3.55 could trigger sharper selling. Conversely, a recovery above this level may reignite bullish momentum.

WTI Oil Price Forecast

U.S. crude oil (USOIL) is trading at $73.19, down 0.09% as prices consolidate above the pivot point at $72.83. The 4-hour chart reveals a double-bottom pattern forming near key support levels, suggesting potential bullish momentum if prices hold above $72.83. Immediate resistance is seen at $75.24, with the next hurdle at $76.48. On the downside, key support lies at $71.84, with additional support at $70.80.

The 50 EMA at $72.24 aligns with near-term support, while the 200 EMA at $70.83 underscores strong long-term stability. A move above $72.83 could trigger a bullish breakout, targeting $75.24. However, a drop below this level may invite sharper selling toward $71.84.

Brent Oil Price Forecast

Brent crude (UKOIL) is trading at $76.06, down 0.09%, as prices consolidate just above the pivot point of $75.72. The 4-hour chart shows near-term bullish momentum supported by the 50 EMA at $75.64 and the 200 EMA at $74.14. Immediate resistance is at $76.89, with the next target at $77.82. On the downside, support is found at $74.69, followed by $73.91.

A sustained move above $75.72 confirms bullish sentiment, potentially targeting $76.89. However, a break below the pivot could lead to sharper selling pressure toward $74.69. With EMAs supporting buying activity, traders should watch the pivot closely for confirmation of the next directional move.