Natural Gas and Oil Forecast: US Inventories Drop, NG at $2.4, Oil at $79

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Updated: May 16, 2024, 10:06 GMT+00:00

Key Points:

Oil prices rose as weaker U.S. CPI boosted hopes for interest rate cuts.
U.S. oil inventories fell by 2.5 million barrels, signaling stronger demand.
China’s $138 billion bond issuance and Canadian wildfires also supported oil prices.

Market Overview

Oil prices rose in Asian trade on Thursday, continuing gains from the previous session. A weaker-than-expected U.S. Consumer Price Index (CPI) lowered the dollar and increased hopes for interest rate cuts, boosting oil prices. A larger-than-expected draw in U.S. inventories further fueled bets on tighter global supplies.

Additionally, optimism over China’s planned 1 trillion yuan ($138 billion) bond issuance and potential supply disruptions from Canadian wildfires supported prices. Official data showed U.S. oil inventories fell by 2.5 million barrels in the week ending May 10, signalling stronger demand.

However, the International Energy Agency (IEA) cut its 2024 demand outlook by 140,000 barrels per day, contrasting with OPEC’s forecast of 2.25 million barrels per day.

Natural Gas Price Forecast

Natural Gas (NG) Price Chart

Natural Gas (NG) is trading at $2.413, up 0.35%. Key price levels include a pivot point at $2.38. Immediate resistance levels are at $2.45, $2.51, and $2.56. Immediate support levels are at $2.31, $2.23, and $2.15.

Technical indicators show mixed signals. The 50-day Exponential Moving Average (EMA) is at $2.26, and the 200-day EMA is at $2.02, both suggesting a bullish trend above these levels.

In conclusion, NG remains bullish above the pivot point at $2.38. A break below this level could trigger a significant selling trend.

WTI Oil Price Forecast

WTI Price Chart

WTI Crude Oil (USOIL) is trading at $79.04, up 0.21%. Key price levels include a pivot point at $78.45. Immediate resistance levels are at $79.48, $80.67, and $81.52. Immediate support levels are at $77.65, $76.75, and $75.83.

Technical indicators show mixed signals. The 50-day Exponential Moving Average (EMA) is at $78.99, with the price slightly above this level, indicating a bullish trend. The 200-day EMA is at $80.74, suggesting longer-term resistance. In conclusion, USOIL remains bullish above the pivot point at $78.45.

Brent Oil Price Forecast

Brent Price Chart

Brent Crude Oil (UKOIL) is trading at $83.14, up 0.24%. Key price levels to watch include a pivot point at $82.98. Immediate resistance levels are at $83.91, $84.49, and $85.57. On the support side, immediate levels are at $82.08, $81.04, and $80.05.

Technical indicators show a mixed outlook. The 50-day Exponential Moving Average (EMA) is at $83.43, indicating that the current price is slightly below this level, suggesting potential resistance.

The 200-day EMA stands at $85.27, highlighting a longer-term resistance level. In conclusion, UKOIL maintains a bullish stance above the pivot point at $82.98.

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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.