Natural Gas and Oil Forecast: US-China Demand Spurs Energy Demand

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Published: Mar 8, 2024, 05:59 GMT+00:00

Key Points:

U.S. and China's heightened demand and Federal Reserve's rate cut hints spur oil price rally.
Natural Gas steadies at $1.85; resistance ahead at $1.92 and $2.06, with bullish EMA signals.
UKOIL's cautious rise to $83.38 faces tests at $83.47 resistance, bullish above pivot $82.97.

Rising Demand and Federal Reserve’s Dovish Stance Fuel Oil Rally

Oil prices have surged, with demand spikes in key markets like the U.S. and China, and positive signals from the Federal Reserve on potential rate cuts bolstering the outlook. U.S. fuel inventories are declining sharply, hinting at robust demand, which may intensify as the American driving season approaches.

Meanwhile, China and India are showing increased oil consumption linked to strong industrial activities. However, this year’s demand growth in China may lag behind 2023’s surge. The softened stance of the Federal Reserve on interest rates, coupled with a weaker U.S. dollar, has also underpinned oil’s ascent.

Additionally, the temporary shutdown of TC Energy’s Keystone pipeline, which has since resumed, offered brief support to prices.

Natural Gas Price Forecast

NG Price Chart

Natural Gas (NG) ticked down marginally to $1.85, registering a decline of 0.11%. Today’s trading positions the pivot point precisely at $1.85, suggesting a market at equilibrium but with potential for movement.

Resistance levels are pegged at $1.92, $1.98, and $2.06, each a test for the commodity’s upward momentum. Meanwhile, supports are established lower at $1.79, $1.73, and $1.68, where declines may find a floor.

The 50-Day and 200-Day Exponential Moving Averages stand at $1.91 and $1.99, respectively, indicating a slender bullish inclination above the current price. A sustained stance above $1.85 may continue the bullish narrative; conversely, slipping below could lead to accelerated selling pressure.

WTI Oil Price Forecast

WTI Price Chart

On March 8, USOIL slightly ascended to $79.44, showing a 0.10% gain amidst a volatile trading environment. The day’s pivot point at $78.72 is a critical juncture, with oil prices just above this mark. Traders are eyeing immediate resistance levels at $79.94, followed by $80.67, and more staunchly at $81.65, where selling pressure may intensify.

On the retreat, support forms at $77.75, with additional safety nets at $76.78 and $75.82, levels where buyers might re-emerge.

Technical indicators shed light on the market’s pulse: the 50-Day Exponential Moving Average (EMA) at $78.68 and the 200-Day EMA at $77.01 both suggest underlying buying interest, keeping the short-term trend cautiously bullish. In summary, USOIL’s trajectory remains bullish as long as it sustains above the $78.70 benchmark.

Brent Oil Price Forecast

UKOIL Price Chart

UKOIL prices modestly climbed to $83.38 on March 8, a 0.26% increase signaling cautious optimism in the market. The day’s technical analysis sets the pivot point at $82.97, which will determine the immediate direction. Resistance levels are identified incrementally at $83.47, $84.06, and a more substantial barrier at $84.86 that might challenge the bullish trend.

Support, conversely, solidifies at $82.56, with subsequent levels at $82.03 and $81.43 offering potential fallbacks for price dips.

The 50-Day and 200-Day Exponential Moving Averages, at $82.68 and $81.62 respectively, suggest a market leaning towards growth. The outlook remains bullish so long as the price remains above the pivot point of $82.97, while a descent below could trigger a more pronounced selling trend.

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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.