Natural Gas and Oil Forecast: WTI and Brent Rise 0.10%; Upside Potential?

By:

Arslan Ali

Updated: May 17, 2024, 10:37 GMT+00:00

Key Points:

Oil prices stable in Asian trade, poised for a mildly positive week.
Brent and WTI futures rise, driven by weaker U.S. inflation data.
Loose monetary conditions and Chinese stimulus boost crude demand.

In this article:

Natural Gas

+0.26%

WTI Oil

+2.31%

Brent Oil

+2.73%

Market Overview

Oil prices remained relatively stable in Asian trade on Friday, poised for a mildly positive week. The softer dollar, shrinking U.S. inventories, and increased Chinese stimulus boosted hopes for improved demand. However, the market faced mixed signals, as the International Energy Agency lowered its demand forecast for the year due to economic uncertainty, particularly concerning China, which faced higher U.S. trade tariffs.

Brent and WTI futures gained this week, driven by softer-than-expected U.S. inflation data. This data weakened the dollar and fueled expectations of Federal Reserve rate cuts by September. However, some Fed officials cautioned that more evidence of falling inflation is needed before trimming rates.

Impact on Natural Gas and Oil Forecast

The anticipation of looser monetary conditions supports crude demand. The upcoming $1 trillion bond issuance in China and data on industrial production and retail sales could further influence the world’s largest oil importer’s demand outlook. The Organization of Petroleum Exporting Countries (OPEC) is expected to maintain production cuts, presenting a tighter supply outlook.

Natural Gas Price Forecast

Natural Gas (NG) Price Chart

Natural Gas (NG) is trading at $2.50, up 0.34% today. The pivot point at $2.47 serves as a critical support level. Immediate resistance is at $2.56, followed by $2.63 and $2.72. On the downside, immediate support is at $2.39, with further support at $2.31 and $2.23.

Technical indicators show the 50-day EMA at $2.31 and the 200-day EMA at $2.05. The upward trendline supports NG near $2.47. Overall, NG remains bullish above $2.47, but a break below this level could trigger a sharp selling trend.

WTI Oil Price Forecast

WTI Price Chart

USOIL is currently trading at $78.93, up 0.12% for the day. The pivot point at $78.67 serves as a critical support level. Immediate resistance is at $79.82, followed by $80.67 and $81.52. On the downside, immediate support is at $77.70, with further support at $76.65 and $75.77.

Technical indicators show the 50-day EMA at $78.97 and the 200-day EMA at $80.63. An upward trendline supports USOIL near $78.67. The closing of a doji candle above this pivot point suggests a potential buying trend.

Overall, USOIL remains bullish above $78.67, but a break below this level could trigger a sharp selling trend.

Brent Oil Price Forecast

Brent Price Chart

UKOIL is trading at $83.49, up 0.13% for the day. The pivot point at $83.19 serves as a critical support level. Immediate resistance is at $84.51, followed by $85.82 and $86.82. On the downside, immediate support is at $82.15, with further support at $81.04 and $80.05.

Technical indicators show the 50-day EMA at $83.39 and the 200-day EMA at $85.15. An upward trendline supports UKOIL near $83.19. The closing of a doji candle above this pivot point suggests a potential buying trend.

Overall, UKOIL remains bullish above $83.19, but a break below this level could trigger a sharp selling trend.

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About the Author

Arslan Aliauthor

Arslan is a finance MBA and also holds an MPhil degree in behavioral finance. An expert in financial analysis and investor psychology, Arslan uses his academic background to bring valuable insights about market sentiment and whether instruments are likely to be overbought or oversold.

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