Natural Gas and Oil Forecast: UAE OPEC Exit Ignites Crude Volatility – Will $116 Break?

Oil and Natural Gas Markets Today

Geopolitical tensions arising from the ongoing US-Iran conflict and the de facto closure of the Strait of Hormuz are & still the main drivers in crude oil fundamentals. We’re seeing a major rise in production shut-ins across the top Gulf producers – Saudi Arabia, Iraq and the UAE – removing millions of barrels per day from global supply & putting a real squeeze on the logistics, with tanker traffic severely disrupted and all that extra rerouting really adding up in the costs.

Brent crude is especially vulnerable to these Middle East disruptions & the extra cost of shipping that comes with them. The UAE formally leaving OPEC on May 1st has just added to the uncertainty floating around – not to mention the cartel’s future plans for output discipline as it is while OPEC+ tries to get a handle on all this. The International Energy Agency and EIA have each marked down their forecasts for global oil demand in 2026 – the conflict and higher energy costs are really taking their toll.

On the other hand, WTI is actually coming out ahead thanks to all that still pretty robust US production we’re seeing, & the country’s inventories are near-record levels – which is helping to insulate us from some of those international shocks at least for the time being. Plus we have those Strategic Petroleum Reserve releases which can give a bit of a short-term supply boost.

It’s a different story with natural gas of course – US fundamentals here are still pretty soft. The latest EIA report showed that US storage levels had built up by a whopping 79 billion cubic feet in the week ended April 24th – getting up to 2,142 billion cubic feet, in fact – which is 153 billion cubic feet above the five year average. & it’s basically all because of the still pretty strong production numbers, the mild spring weather, and the fact that heating demand is lower than usual right now that all these extra supplies are piling up. & just ahead of the injection season to boot.

Natural Gas Price Forecast: Bearish Channel Caps Recovery Near $2.85

Natural gas is currently trading at $2.83 and it’s trying to do a recovery thing within a broader descinding channel structure. Price has recently bounced back up from $2.60 but now it’s facing resistance at $2.85 – we’ve had a few rejections at that point before so it’s no surprise we’re seeing it again. 50 EMA is starting to flatten out while the 200 EMA is still sloping downwards which tells us that the broader trend is still bearish. And let’s be honest, the fact that price has been rejected a few times at that resistance point just goes to show that supply pressure is still pretty strong up there.

RSI’s coming up towards 60 – that’s a sign of some short-term bullish momentum but its not quite enough to convince us that the trend is reversing. So if we do see a break above $2.85 then we might see price go towards $2.93, but if we see a rejection we might see it fall back to $2.68 or lower.

Trade Idea: Sell below $2.85 with a target of $2.68, set a stop-loss above $2.93.

WTI Crude Oil Price Forecast: Bullish Channel Holds Above $102 Support

WTI crude is currently trading at around $106.50, and it’s continuing its upward momentum in a rising channel on the 2-hour chart. Price recently bounced back up from the mid-channel support line around $102.70 and that coincidently also aligned with the 50 EMA, so you know that’s some pretty strong support right there. Price has actually broken above a minor resistance point at $105.00 which is a pretty clear sign that buyers are back in the driving seat. the 200 EMA is still well below the price line which tells us that the overall trend is still very much up. RSI’s looking pretty good too – it’s coming back up towards 60, which is a sign that the bullish momentum is gaining strength but its not getting overbought yet.

If WTI can hold above $105.00, then the next level of resistance is going to be at $110.80 followed by $116.50 which is right near the top of the channel. If on the other hand, price starts to fall and gets below $102.70 then $98.30 could be the next target on the list.

Trade Idea: Buy above $105.00 and have a target of $110.80, set a stop-loss below $102.50.

Brent Crude Oil Forecast: Breakout Above $110 Signals Upside Continuation

Brent crude is currently trading around $113.50 and it’s pushing on higher after it successfully reclaimed the $109.70 level as support. Price has been consistently making higher lows over an ascending trendline which is a pretty strong sign that this is a sustained bullish structure. That impulsive candle above $112 just confirmed to us that price has finally broken out of that consolidation phase, and some of the momentum indicators are also starting to look pretty good – 50 EMA is rising, price is above the 200 EMA, and RSI is climbing up towards 65 which is a sign that buying pressure is really starting to pick up.

If we can get a sustained move above $113.50 then we’re looking at $115.00 and $119.30 as our next targets. But if we can’t hold $109.70 then we might be looking at a pullback towards $103.40

Trade Idea: Buy above $112.00 with a target of $115.00, set a stop-loss below $109.50