Natural Gas and Oil Forecast: Energy Prices Climb Over 0.25%; More Upside Ahead?

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Updated: May 9, 2024, 10:39 GMT+00:00

Key Points:

Oil prices tick up as U.S. mediates potential Israel-Hamas ceasefire, markets watch closely.
China's oil imports dip in April despite stronger overall economic indicators, suggesting demand cooling.
High interest rates suppress oil demand; future rate cuts or OPEC+ cuts could stabilize markets.

Natural Gas and Oil Forecast: Energy Prices Climb Over 0.25%; More Upside Ahead?

Market Overview

Oil prices increased slightly in Asian markets on Thursday after mixed trade data from China and as geopolitical tensions in the Middle East remained high. The possibility of a ceasefire between Israel and Hamas was a focal point, particularly with the U.S. intensifying efforts to mediate.

This context saw Brent oil futures rise to $83.92 and West Texas Intermediate to $79.41 per barrel. However, a decline in China’s oil imports in April, despite stronger overall imports, suggested a potential cooling in the world’s largest crude importer’s demand.

Although there are still expectations for increased refinery output over the summer, China’s push for electric vehicles and low travel demand have made this situation worse. Additionally, ongoing high interest rates could further suppress demand, although any future rate cuts or extended production cuts by OPEC+ might stabilize prices.

Natural Gas Price Forecast

Natural Gas (NG) Price Chart

Natural Gas (NG) is trading at $2.318 today, marking a 0.30% increase. The technical framework highlights a pivot point at $2.30, with resistance levels identified at $2.34, $2.40, and $2.45. These thresholds could cap upward movements if approached. Conversely, support levels are established at $2.24, $2.19, and $2.15, which could provide a cushion if prices decline.

The 50-day Exponential Moving Average (EMA) at $2.19 and the 200-day EMA at $2.03 align with the lower end of NG’s recent trading range, suggesting a foundational support zone. Market outlook is bullish above $2.30; a break below may trigger a sharp selling trend due to ongoing volatility in the tight trading range between $2.30 and $2.40.

WTI Oil Price Forecast

WTI Price Chart

Today, USOIL trades at $79.41, marking a slight increase of 0.27%. The commodity’s key technical levels reveal a current pivot point at $78.97. Resistance levels are poised at $79.85, $80.71, and $81.53, suggesting potential targets for bullish momentum. Conversely, support levels are established at $77.56, $76.85, and $76.16, indicating where buyers might re-emerge if declines occur.

Technical analysis shows the 50-day Exponential Moving Average (EMA) at $79.65, closely aligning with current prices, while the 200-day EMA stands at $81.43, underscoring a strong resistance area. The technical stance remains bullish above $78.97, but a break below this threshold could trigger a significant sell-off.

Brent Oil Price Forecast

Brent Price Chart

UKOIL is currently priced at $83.92, experiencing a modest increase of 0.24%. Our analysis identifies $83.67 as the pivotal price level for today’s trading session. Should prices continue to ascend, key resistance levels to watch are $84.71, $85.57, and $86.54, which may serve as potential barriers to further increases. On the downside, if prices retract, support can be found at $82.77, followed by $81.94 and $81.08, indicating possible stabilization points.

Technical indicators such as the 50-day Exponential Moving Average (EMA) at $84.33 and the 200-day EMA at $86.02 suggest a bullish stance if prices remain above the pivot. However, dipping below $83.67 could prompt a significant downward trend.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Arslan Aliauthor

Arslan, a webinar speaker and derivatives analyst, has an MBA in Finance and MPhil in Behavioral Finance. He guides financial analysis, trading, and cryptocurrency forecasting. Expert in trading psychology and sentiment.