Natural Gas and Oil Forecast: Middle East Tensions Underpin Energy Sector

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Updated: Apr 12, 2024, 11:09 GMT+00:00

Rising geopolitical tensions in the Middle East propel oil prices higher, despite underlying concerns of slower U.S. rate cuts impacting weekly trends.

In this article:

Natural Gas

-0.78%

WTI Oil

-3.42%

Brent Oil

-3.10%

Market Overview

Oil prices increased on Friday due to rising tensions in the Middle East, potentially disrupting supply from the oil-rich region. Despite this uptick, oil is poised for a weekly decline influenced by the reduced likelihood of U.S. interest rate cuts this year.

The situation escalated following a suspected Israeli airstrike on Iran’s embassy in Damascus, with Iran vowing retaliation. Such geopolitical risks, alongside OPEC+’s supply cuts and improving global economic conditions, have significantly impacted oil price forecasts.

However, ongoing U.S. inflation concerns temper these gains, suggesting a cautious outlook for the oil market.

Natural Gas Price Forecast

Natural Gas (NG) Price Chart

Today’s analysis of Natural Gas (NG) reflects a decrease, with the price falling to $1.90, down by 0.52%. The pivot point stands at $1.89, critical for maintaining a bullish stance. Resistance levels are set at $1.95, $2.00, and $2.04, suggesting possible ceilings for upward movement.

On the downside, support is identified at $1.84, with additional layers at $1.78 and $1.72 that could arrest further declines. Both the 50-Day Exponential Moving Average at $1.94 and the 200-Day EMA at $1.89 underline this pivot, indicating potential price stability.

However, a break below $1.89 could lead to a sharp selling trend, warranting vigilant market monitoring.

WTI Oil Price Forecast

WTI Price Chart

Today’s technical outlook for USOIL indicates a slight increase, with the current price marked at $85.60, up by 0.13%. The critical pivot point stands at $85.44, setting a baseline for bullish sentiment above this threshold.

Resistance levels are identified at $86.63, $87.63, and $88.53, respectively, offering potential hurdles in upward movement. Support levels to watch are $84.58, $83.57, and $82.54, providing cushions against downward trends.

The 50-Day Exponential Moving Average at $85.74 slightly surpasses the pivot, suggesting underlying strength, while the 200-Day EMA at $84.00 further bolsters support.

A break below the pivot point could trigger a notable selling trend, highlighting the need for vigilance around this key level.

Brent Oil Price Forecast

Brent Price Chart

Today’s assessment of UKOIL reveals a modest uptick to $90.20, a gain of 0.06%. The established pivot point at $89.99 marks a crucial juncture; trading above this level suggests a bullish outlook. The chart shows resistance levels at $90.92, $91.90, and $92.89 that may challenge further advances.

Conversely, support is positioned at $89.15, with further buffers at $87.89 and $86.37 potentially stabilizing any declines. The 50-Day Exponential Moving Average closely aligns with the pivot at $90.01, reinforcing current levels, while the 200-Day EMA at $88.02 supports a longer-term bullish trend.

Should prices fall below $89.99, a sharp selling trend could be triggered, necessitating cautious monitoring.

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

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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