Natural Gas, WTI Oil, Brent Oil Forecasts – Oil Soars 6% As Iran Demands Reparations

Natural Gas Tests Resistance At $2.75 – $2.80

Natural gas gains ground as traders focus on strong demand for natural gas, which is caused by hot weather.

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

On the support side, a move below the $2.70 level will push natural gas towards recent lows near $2.62. If natural gas declines below the $2.62 level, it will head towards the support at $2.50 – $2.55.

WTI Oil Soars As U.S. – Iran Talks Fail

WTI oil rallied as traders focused on geopolitical news. U.S. and Iran did not reach a temporary deal over the weekend. In fact, it looks that both sides are moving away from a potential deal.

Iran demanded payment of reparations as a condition of reopening of the Strait of Hormuz. In turn, President Trump announced that U.S. will seek compensation from Iran “for all the people that they have killed and gravely wounded”. Obviously, these demands will be rejected.

Trump added that compensations for Iran were never discussed during meetings and negotiations. Iran reiterated its demands for reparations. Iran also wants the U.S. to lift the naval blockade.

President Trump signaled that he would use economic pressure to push Iran back to negotiations. He said that Iran suffered from huge inflation and had no money. Recent reports showed that U.S. naval blockade was effective in putting Iran’s oil exports to a halt.

Recent developments may serve as a major catalyst for oil markets. It looks that both U.S. and Iran believe that the other side will blink first. This strategy means that the Strait of Hormuz could be blocked for weeks.

WTI oil attempts to settle above the resistance at $81.50 – $82.00. If WTI oil manages to settle above the $82.00 level, it will head towards the next resistance, which is located in the $86.00 – $86.50 range.

On the support side, a move below the 50 MA at $79.68 will push WTI oil towards the nearest support at $77.50 – $78.00.

Brent Oil Attempts To Settle Above The $87.00 Level

Brent oil soared as traders bet that the Strait of Hormuz would not be reopened in the near term. A “waiting game” between U.S. and Iran would lead to further disruptions in the oil markets and may push prices back towards recent highs.

From the technical point of view, Brent oil is trying to settle above the resistance at $86.50 – $87.00. If Brent oil manages to settle above the $87.00 level, it will head towards the next resistance, which is located in the $91.00 – $91.50 range. In case Brent oil climbs above $91.50, it will head towards the $95.00 level.

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