Natural Gas, WTI Oil, Brent Oil Forecasts – Oil Plunges 5% As Trump Cancels Iran Strikes

Natural Gas Pulls Back As Storage Build Exceeds Estimates

Natural gas  is losing ground as traders react to the EIA Weekly Natural Gas Storage Report. The report indicated that working gas in storage increased by +108 Bcf from the previous week, exceeding the analyst estimate of +101 Bcf. The higher-than-expected storage build put pressure on natural gas prices.

At current levels, stocks are -5 Bcf less than last year and +151 Bcf above the five-year average for this time of the year.

Currently, natural gas is trying to settle below the support at $3.00 – $3.05. In case this attempt is successful, natural gas will head towards the next support level, which is located in the $2.75 – $2.80 range. RSI is in the moderate territory, so there is plenty of room to gain momentum in the near term.

WTI Oil Dives As Traders Focus On Trump’s Surprising Announcement

WTI oil suffered a sell-off as President Trump canceled the scheduled strikes against Iran. Earlier, Trump said that the U.S. would be hitting Iran very hard as the country did not agree to a deal. He also raised the possibility of capturing Iran’s Kharg island, which is the center of the country’s oil trade.

Trump said that “discussions and final points have been, in both concept and great detail, approved by all parties involved.” The list of parties he presented did not include Iran. At the time of writing, Iran did not comment on Trump’s announcement.

Trump also added that the naval blockade of Iran would remain in place until the deal is finalized.

Recent reports indicated that UAE and Iran officials had a face-to-face meeting to discuss mutual relations. UAE was the most hawkish country in the region as it had been hit hard by Iran.  The strikes against UAE disrupted flights and put the country’s status of a financial safe-haven in doubt. The meeting shows that the region as a whole is moving towards a peace deal, which is bearish for oil.

At this point, Iran’s position is unclear. As noted above, Trump did not list Iran as a party that agreed to the deal, which means that negotiations continue. That said, traders believe that U.S. and Iran are moving towards a deal, which could be announced soon.

Currently, WTI oil is trying to settle below the $87.00 level. In case this attempt is successful, WTI oil will head towards the support at $85.00 – $85.50. A move below the $85.00 level will open the way to the test of the next support at $81.00 – $81.50.

Brent Oil Tests The $90.00 Level

Brent oil is under strong pressure as traders react to Trump’s surprising announcement and bet that U.S. and Iran would be able to negotiate a deal.

Brent oil is trying to settle below the support level at $91.00 – $91.50. In case this attempt is successful, Brent oil will head towards the next support level, which is located in the $86.00 – $86.50 range.

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