Natural Gas, WTI Oil, Brent Oil Forecasts – Brent Oil Rallies Above $100 Amid Middle East Escalation

Natural Gas Retreats On Cooler Weather Forecasts

Natural gas remains under pressure as traders stay focused on cooler weather forecasts and bet on weaker demand.

From the technical point of view, natural gas settled below the 50 MA at $2.92 and pulled back towards the nearest support, which is located in the $2.75 – $2.80 range.

In case natural gas settles below the $2.75 level, it will head towards the next support level at $2.60 – $2.65. RSI remains in the moderate territory, so there is plenty of room to gain momentum in the near term.

WTI Oil Rallies As U.S. Destroys Iranian Tankers

WTI oil tests new highs as traders focus on recent developments in the Middle East.

U.S. said that it destroyed five Iranian tankers as Iran attempted to attack a Navy warship with ballistic missiles. Iran said that it attacked eight tankers and two U.S. warships.

Meanwhile, tensions between Saudi Arabia and Yemen’s Houthis continued to increase. Houthis have recently attacked Saudi Arabia’s oil facilities, while Saudi Arabia put pressure on Yemen’s capital Sana’a, which is controlled by Houthis.

Recent reports indicated that Iran was ready for intense war and planned to escalate in case U.S. continued to attack the country’s infrastructure. I’d note that the risks of additional escalation are rising on a daily basis. Finally, the oil market has started to price in such risks.

At this point, there are no signs indicating that U.S. and Iran are ready to get back to serious negotiations. The U.S. believes that it will put enough pressure on Iranian economy through sanctions and naval blockade.

Iran bets that oil prices will test historic highs and force the U.S. to negotiate. In the near term, neither side is ready for any concessions, which is bullish for oil prices.

Currently, WTI oil is trying to settle above the $96.00 level. In case this attempt is successful, WTI oil will head towards the next resistance level, which is located in the $97.50 – $98.00 range. A successful test of the $98.00 level will open the way to the test of the psychologically important $100.00 level. If WTI oil climbs above $100, it will head towards the resistance at $102.50 – $103.00.

Brent Oil Tests Resistance At $101.50 – $102.00

Brent oil rallied above the psychologically important $100.00 level as traders reacted to the situation in the Middle East. I’d note that there are no signs of panic buying, and it looks that oil prices have a good chance to gain additional upside momentum in case the right catalysts emerge.

Brent oil is trying to settle above the resistance level at $101.50 – $102.00. In case Brent oil manages to settle above the $102.00 level, it will head towards the next resistance, which is located in the $108.50 – $109.00 range. RSI is close to the overbought territory, but there is enough room to gain momentum in the near term.

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