Natural Gas Tests Resistance At $3.00 – $3.05
Natural gas is moving higher as rebound continues despite low demand. Currently, natrual gas is trying to settle above the resistance level at $3.00 – $3.05. If natural gas manages to settle above the $3.05 level, it will head towards the next resistance at $3.20 – $3.25.
On the support side, natural gas needs to settle back below the $3.00 level to have a chance to gain downside momentum in the near term. In this case, natural gas will head towards the 50 MA at $2.91. If natural gas declines below the 50 MA, it will move towards the support level at $2.75 – $2.80.
WTI Oil Retreats As Saudi Aramco Reduces Prices For Asian Clients
WTI oil pulls back as traders focus on Saudi Arabia. The country has cut prices for its oil going to Asia and prepared for fighting in Yemen.
Saudi Aramco lowered the price for Asian buyers by as much as $5 per barrel below the regional benchmark. This move suggests that the flows of oil through the Strait of Hormuz have started to increase.
Recent reports suggest that Saudi Arabia may be ready to help Yemen’s official government in its fight against the Houthis. The forces of the official government have launched a full-scale military campaign against the militant group.
Meanwhile, Saudi Arabia has fully restored the flow of oil through the East-West pipeline, which is used to bypass the Strait of Hormuz. There was no official announcement from Saudi Aramco, but recent reports suggest that the pipeline was operating normally.
Iran has not loaded any oil cargo last month due to naval blockade of its ports, so the risks of escalation are rising. At some point, Iran would be forced to choose whether it wants to break the blockade or start serious negotiations with the U.S.
Currently, WTI oil is trying to settle below the support at $88.50 – $89.00. If WTI oil manages to settle below the $85.00 level, it will head towards the next support, which is located in the $84.50 – $85.00 range. RSI is in the moderate territory, so there is plenty of room to gain additional downside momentum in case the right catalysts emerge.
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See all Natural Gas forecastsBrent Oil Tests The $100 Level
Brent oil moved lower as traders bet that Iran could not stop oil going through the Strait of Hormuz. At this point, traders ignore the risks of escalation.
Traders also focus on reports indicating that U.S. and Iran were ready to continue negotiations. Iranian media reported that an official would visit Qatar’s Doha for talks.
If Brent oil settles below the psychologically important $100.00 level, it will head towards the support level at $97.00 – $97.50. A move below the $97.00 level will push Brent oil towards the 50 MA at $94.84.
On the upside, Brent oil needs to settle back above the $102.00 level to have a chance to gain upside, momentum in the near term. In this case, Brent oil will head towards the resistance at $109.00 – $109.50.
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