Natural Gas, WTI Oil, Brent Oil Forecasts – Oil Rallies 4% As Iran Rejects U.S. Proposals And Demands Reparations

Natural Gas Tests Resistance At $3.00 – $3.05

Natural gas gains ground as traders react to the EIA Weekly Natural Gas Storage Report.

The report indicated that working gas in storage declined by -54 Bcf from the previous week, compared to analyst forecast of -44 Bcf. The bigger-than-expected draw provided additional support to natural gas markets.

At current levels, stocks are +90 Bcf higher than last year and +14 Bcf above the five-year average for this time of the year.

Currently, natural gas is trying to settle above the resistance level at $3.00 – $3.05. In case this attempt is successful, natural gas will move towards the next resistance level, which is located in the $3.25 – $3.30 range. RSI is in the moderate territory, and there is plenty of room to gain momentum in case the right catalysts emerge.

WTI Oil Soars As Trump Says He Does Not Know Whether Iran Deal Is Possible

WTI oil rallied as traders focused on the news from the Middle East. Iran has officially rejected a 15-point plan to end the war that was presented by the U.S.

In turn, Iran came up with its own plan. This plan implies security guarantees and payment of reparations from U.S. and Israel. Not surprisingly, oil traders do not believe that the war will end soon.

President Trump has recently said that he did not know if Iran deal was possible. He added that he did not know whether U.S. wanted to make a deal. Obviously, Trump wants his comments to be as vague as possible. Meanwhile, Iran prepares to fight against a ground operation.

Iran’s leadership has already changed several times as U.S. and Israel delivered successful strikes against high-profile figures. However, the country did not lose internal control, and many analysts predict that Iran will try additional assymetric measures in case U.S. starts a ground operation.

Geopolitical premium is rising as traders beleive that the probability of a ground operation is growing day by day. In this scenario, Iran may launch additional attacks against energy assets in the region, but may also attack desalination plants to create chaos and put more pressure on Gulf countries.

WTI oil settled above the resistance level at $90.00 – $90.50 and is trying to settle above the $95.00 level. In case this attempt is successful, WTI oil will head towards the next resistance, which is located in the $97.00 – $97.50 range. A successful test of this level will open the way to the test of the psychologically important $100 level.

Brent Oil Attempts To Settle Above $109.00 As Geopolitical Premium Rises

Brent oil gained strong upside momentum as traders prepared for a potential ground operation in Iran.

It should be noted that Brent oil continues to trade at a significant premium to WTI oil. The strong domestic production in the U.S. puts some pressure on WTI oil prices, while Brent oil prices are more exposed to the conflict.

The nearest resistance level for Brent oil is located in the $108.50 – $109.00 range. If Brent oil climbs above the $109.00 level, it will move towards the next resistance at $118.50 – $119.00. A move above the $119.00 level will indicate that the market is in a state of panic.

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