Natural Gas, WTI Oil, Brent Oil Forecasts – Oil Retreats From Session Highs As Israel Agrees To Negotiate With Lebanon

Natural Gas Pulls Back After Bearish EIA Report

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 +50 Bcf from the previous week, compared to analyst consensus of +46 Bcf.

The higher-than-expected storage build put additional pressure on natural gas markets in today’s trading session.

At current levels, stocks are +89 Bcf higher than last year and +87 Bcf above the five-year average for this time of the year.

Current demand for natural gas is low. Weather forecasts indicated that demand will stay low for the next seven days, which is bearish for natural gas markets.

Natural gas settled below the support at $2.75 – $2.80 and is trying to settle below the $2.75 level. In case this attempt is successful, natural gas will move towards the support level, which is located in the $2.50 – $2.55 range. RSI remains in the moderate territory, so there is plenty of room to gain additional downside momentum in the near term.

WTI Oil Declines As Traders Focus On Upcoming Negotiations Between Israel And Lebanon

WTI oil pulled back from session highs as Israel indicated that it was ready to negotiate with Lebanon.

Iran has recently said that it would not unblock the Strait of Hormuz until Israel ends its operation against Hezbollah in Lebanon.

U.S. President Trump signaled that Iran was more diplomatic than it showed in public. He warned the that country would pay a heavy price in case it did not agree to a deal.

Iranian Supreme Leader Mojtaba Khamenei has recently issued a statement, indicating that his country was seeking compensation for war damages. Khamenei noted that Iran was moving to a new regime in managing the Strait of Hormuz. It looks that Iran’s plan is to collect fees from vessels passing through the Strait and say that such fees are “reparations” for war damages.

At this point, the Strait of Hormuz remains mostly closed. Any vessel passing through the Strait must be approved by Iranian forces. Thus, the situation in the physical oil market has not improved.

The futures market is focused on Israel’s decision to negotiate with Lebanon, which offers hopes for broader stabilization in the Middle East. That said, many things could go wrong in the upcoming days.

WTI oil made an attempt to settle above the support at $102.00 – $102.50 but lost momentum and pulled back below the $97.00 level. If WTI oil settles below $97.00, it will head towards the nearest support level, which is located in the $91.00 – $92.00 range.

Brent Oil Attempts To Settle Back Below The $95.00 Level

Brent oil pulled back as traders bet that U.S. and Iran will be able to reach a peace deal.

Israel’s Prime Minister Benjamin Netanyahu has recently said that there was no ceasefire in Lebanon. He noted that the country would ensure the security of Northern Israel.

The market did not show strong reaction to Netanyahu’s hawkish remarks as traders bet that Israel would start negotiations with Lebanon next week.

If Brent oil stays below the resistance at $97.00 – $97.50, it will move towards the support level, which is located near recent lows at $91.00 – $92.00.

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