Natural Gas, WTI Oil, Brent Oil Forecasts – Oil Tests New Highs As Trump Cancels The 20% Fee For Hormuz Passage

Natural Gas Attempts To Settle Above $3.90

Natural gas is mostly flat as traders evaluate their next moves after the strong pullback, which was triggered by the EIA report.

In case natural gas manages to settle above the $2.90 level, it will head towards the resistance level at $3.00 – $3.05. A successful test of this level will push natural gas towards the 50 MA at $3.09. If natural gas climbs above the 50 MA, it will move towards the resistance level at $3.20 – $3.25.

WTI Oil Gains Ground Amid Tensions In The Middle East

WTI oil tested new highs as traders remained focused on the situation in the Strait of Hormuz. Earlier, President Trump announced that U.S. will impose a naval blockade on Iranian ports. He also revealed that U.S. would charge a 20% fee for safe passage through the Strait of Hormuz.

Today, Trump said that he decided to “replace the 20% United States Reimbursement Fee” with trade and investment deals that Gulf states would make with the U.S. He did not specify which countries would invest in the U.S.

Trump added that he talked with Saudi Arabia, Qatar, Bahrain, Kuwait and UAE. Obviously, Gulf states opposed the fee. According to recent reports, Gulf states remain focused on ensuring that no one charges a fee for passage through the Strait of Hormuz. It should be noted that Iran planned to charge such a fee and wanted Oman to join the effort.

From a big picture point of view, market participants worry that a potential fee in the Strait of Hormuz would set a precedent for the whole world. Similar fees would emerge elsewhere, raising inflation and hurting maritime trade.

Meanwhile, U.S. and Iran trade strikes in the region. The intensity of the strikes has not reached levels seen during the first round of the Middle East war, but the situation may change in case U.S. and Iran do not get back to negotiations.

Currently, WTI oil is trying to settle above the resistance level at $80.00 – $80.50. In case this attempt is successful, WTI oil will move towards the next resistance at $86.00 – $86.50. RSI is in the moderate territory, so there is plenty of room to gain additional upside momentum in case the right catalysts emerge.

Brent Oil Tests Resistance At $86.00 – $86.50

Brent oil tested new highs as traders bet that the flow of oil through the Strait of Hormuz would be cut. Global oil reserves have declined since the start of the war in the Middle East, which presents a serious risk in case U.S. and Iran do not reach a ceasefire deal again.

The nearest resistance level for Brent oil is located in the $86.00 – $86.50 range. A move above the $86.50 level will push Brent oil towards the 50 MA at $89.33. In case Brent oil climbs above the 50 MA, it will head towards the resistance level at $90.50 – $91.00.

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