Natural Gas, WTI Oil, Brent Oil Forecasts – Oil Pulls Back From Session Highs

Natural Gas Moves Lower As Traders Sell The Rally

Natural gas retreats as traders rush to take some profits off the table after the recent rebound.

In case natural gas settles back below the $3.15 level, it will get to the test of the support level at $3.00 – $3.05. A move below the $3.00 level will provide natural gas with an opportunity to gain additional downside momentum.

On the upside, natural gas needs to settle above the resistance at $3.20 – $3.25 to gain upside momentum in the near term. If natural gas settles above $3.25, it will head towards the resistance level at $3.40 – $3.45.

WTI Oil Is Mostly Flat As Traders Focus On The EIA Report

WTI oil is swinging between gains and losses as traders react to the EIA Weekly Petroleum Status Report. The report indicated that crude inventories declined by -8.3 million barrels from the previous week, compared to analyst forecast of -4.6 million barrels. At current levels, crude inventories are about 6% below the five-year average for this time of the year.

Totol motor gasoline inventories decreased by -0.9 million barrels while analysts expected that they would decline by -1 million barrels. Distillate fuel inventories increased by +1 million barrels from the previous week.

U.S. crude oil imports decreased by 754,000 bpd, averaging 5.1 million bpd. Over the past four weeks, crude oil imports averaged about 5.7 million bpd.

Strategic Petroleum Reserve declined from 349.2 million barrels to 340.3 million barrels as U.S. continued to sell oil from strategic reserves. Domestic oil production increased from 13.799 million bpd to 13.806 million bpd.

President Trump said that the memorandum of understanding with Iran could be signed as soon as tomorrow. Traders prepare for the robust reopening of the Strait of Hormuz and expect that Iranian oil will flow into the market. The U.S. is expected to deliver sanction waivers for Iranian oil.

Interestingly, Trump noted that military escalation in the Middle East could have led to an international depression and added that the did not want to be like Herbert Hoover, who was President when the Great Depression began.

From the technical point of view, WTI oil continues its attempts to settle below the support at $76.50 – $77.00. In case WTI oil manages to settle below the $76.50 level, it will head towards the next support, which is located in the $70.50 – $71.00 range. It should be noted that RSI remains in the moderate territory, so there is enough room to gain additional downside momentum in the near term.

Brent Oil Remains Stuck Below The $80.00 Level

Brent oil pulled back from session highs and moved lower as traders bet that the Strait of Hormuz would be reopened soon.

A successful test of the support level at $77.00 – $77.50 will open the way to the test of the next support at $72.50 – $73.00. On the upside, Brent oil needs to settle above the $81.50 level to have a chance to gain sustainable upside momentum in the near term.

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