Natural Gas and Oil Forecast: Christmas Shutdown Masks Growing Energy Market Risks

Market Overview

Crude oil ended Wednesday largely unchanged but remained supported by rising geopolitical tensions that have lifted risk premiums across energy markets. Prices drew underlying support from a sharp decline in US drilling activity, with active oil rigs recently touching a 4.25-year low near 406 before a modest rebound.

Supply-side pressures have also intensified, as disruptions to tanker flows and infrastructure have constrained global exports, while floating storage fell 7% week on week to 107.15 mn barrels. At the same time, OPEC+ has delayed further output increases into early 2026, even as forecasters project a sizeable global surplus.

For natural gas and oil, the near-term outlook reflects tighter effective supply colliding with longer-term oversupply risks, keeping prices sensitive to further geopolitical shocks.

Natural Gas Price Forecast

Natural gas futures on the 2-hour chart are holding near $4.25, reflecting Wednesday’s closing price ahead of the Dec 25 holiday, with the setup relevant for when markets reopen. Price has pulled back from the recent $4.45 spike and remains capped below a descending trendline drawn from the $5.30 high, keeping the broader structure bearish.

The rebound from the $3.82 low stalled near the 50-EMA and 200-EMA, which continue to act as dynamic resistance around $4.35. Recent candles show long upper wicks and weaker closes, suggesting selling pressure on rallies.

Fibonacci retracement from $5.30 to $3.82 places the 50%–61.8% zone between $4.55–$4.75, well above current price. RSI has rolled over from near 65 toward 55, indicating fading momentum, leaving the bias tilted toward a sell below $4.35, stop at $4.55, and target at $4.00.

WTI Oil Price Forecast

WTI crude oil on the 2-hour timeframe is holding near $58.40, reflecting Wednesday’s closing price ahead of the holiday pause, with the setup relevant for when markets reopen. Price remains capped below a descending trendline drawn from the $60.80 high, despite a sharp rebound from the $55.20 low.

Structure still fits within a broader falling channel, suggesting the recovery is corrective rather than a trend change. Recent candles show smaller bodies with upper wicks around $58.80–$59.10, pointing to supply at resistance. The 50-EMA has crossed above the 200-EMA, supporting short-term momentum, though price stays below channel resistance.

Fibonacci retracement from $60.80 to $55.20 places the 61.8% level near $58.90, aligning with the trendline, while RSI has eased toward 60, indicating cooling momentum, leaving the bias for the next session tilted toward a sell near $58.90, stop at $59.60, and target at $57.10.

Brent Oil Price Forecast

Brent crude oil on the 2-hour chart is holding near $61.85, reflecting Wednesday’s closing price ahead of the Dec 25 holiday, with the setup relevant for when markets reopen. Price has rebounded strongly from the $58.70 low but is now stalling below a descending trendline drawn from the $64.10 high, keeping the broader structure corrective.

Recent candles show smaller bodies and upper wicks around $62.00–$62.20, suggesting supply near resistance. The rebound remains capped inside a wider falling channel, while the 50-EMA has crossed above the 200-EMA, supporting short-term momentum without confirming a trend shift.

Fibonacci retracement from $64.10 to $58.70 places the 61.8% level near $62.30, aligning with trendline resistance. RSI has eased toward 58, showing momentum cooling rather than turning bearish, leaving the bias for the next session tilted toward a sell near $62.20, stop at $63.00, and target at $60.65.