Natural Gas, WTI Oil, Brent Oil Forecasts – Oil Rallies As Iran Rejects Negotiations On The Strait Of Hormuz

Natural Gas Tests Support At $3.00 – $3.05

Natural gas is losing ground as traders’ focus shifts from Middle East tensions to low domestic demand.

Weather forecasts show that demand will likely remain low over the weekend. Yesterday’s EIA report, which indicated that working gas in storage increased by +35 Bcf from the previous week, did not provide any support to the market.

From the technical point of view, natural gas attempts to settle below the support level at $3.00 – $3.05. In case natural gas manages to settle below the $3.00 level, it will move towards the next support, 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 Moves Higher As Traders Prepare For Escalation In The Middle East War

WTI oil rebounds amid reports indicating that U.S. will send more warships to the Middle East.

An Axios report showed that U.S. was thinking about a potential occupation of Iran’s Kharg Island. This island is the center of Iran’s oil trade, and its occupation would paralyze Iran’s oil exports.

According to recent reports, Iranian officials are not ready to discuss the reopening of the Strait of Hormuz. The country is not willing to negotiate when it is under attack. U.S. and Israel have shown no desire to stop their military operation against Iran, so oil traders bet on a long war.

It should be noted that attacks have killed many of Iran’s high-profile figures, so it is not clear whether Iran is ready to present a consolidated position in negotiations.

The new Supreme Leader, Mojtaba Khamenei, has not appeared in public. A news anchor has recently presented his written message for the Persian New Year, in which Khamenei said the the “enemy had been defeated”.

Currently, WTI oil is trying to settle above the resistance at $97.00 – $97.50. In case this attempt is successful, WTI oil will move towards the next resistance level, which is located in the $103.50 – $104.00 range.

Brent Oil Attempts To Settle Above The $110 Level

Brent oil gains ground as traders bet that the Strait of Hormuz would remain shut in the upcoming weeks.

At this point, it looks that the situation in the Middle East will get worse before it gets better. U.S. and allies are unable to escort ships through the Strait of Hormuz due to high risks, while Iran is not ready to negotiate.

As the media has started to talk about a potential ground operation in Iran, traders have few reasons to sell oil. It should be noted that additional damage to oil-producing facilities could keep the market in deficit for months, serving as a significant positive catalyst for oil prices.

Brent oil attempts to settle above the resistance level at $108.50 – $109.00. If Brent oil manages to settle above the $109.00 level, it will move towards the next resistance, which is located near recent highs in the $118.50 – $119.00 range.

A move above the $119.00 level will signal that the market is in the state of panic. In this case, oil prices may quickly move towards the $150.00 level.

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