Natural Gas, WTI Oil, Brent Oil Forecasts – Oil Tests New Highs As U.S. Intensifies Strikes Against Iran

Natural Gas Retreats As Traders Focus On Low Demand

Natural gas is losing ground as traders react to the recent EIA report and focus on weather forecasts.

The EIA report showed that working gas in storage declined by -38 Bcf from the previous week, compared to analyst consensus of -42 Bcf.

Current demand for natural gas is low. Weather forecasts indicate that demand will stay low over the weekend but may increase on Monday.

In Europe, natural gas prices were mostly unchanged despite major problems in the Strait of Hormuz.

From the technical point of view, natural gas failed to settle above the resistance at $3.25 – $3.30 and pulled back towards the $3.15 level. In case natural gas manages to settle below $3.15, it will head towards the nearest support, which is located in the $3.00 – $3.05 range.

WTI Oil Tests New Highs Ahead Of The Weekend

WTI oil gained ground as U.S. said that it would intensify strikes against Iran. Israel noted that it conducted multiple stikes across Iran’s capital Tehran.

According to a recent Reuters report, Iran let two LNG carriers from India sail through the Strait of Hormuz. The world’s key energy route remained closed for other vessels.

Recent reports have also indicated that U.S. was moving a Marine expeditionary unit to the Middle East, which may signal another escalation. At this point, the war is conducted via air strikes. Any operation on the land would be a huge escalation and will have a major impact on global market dynamics.

Meanwhile, Iran continues to hit Middle East countries which host U.S. military bases. Iran’s new Supreme Leader, Mojtaba Khamenei, has not appeared in public. U.S. believes that he is wounded, but it is clear that his absence has little impact on Iran’s ability to conduct operations.

From a big picture point of view, the market continues to prepare for a lengthy war. It is too early to say that all risks have already been priced in by the oil markets. Most likely, oil prices have sufficient upside potential in case the Strait of Hormuz remains closed for weeks.

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

Brent Oil Moved Above $100 As Traders Bet On Long War

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

The recent IEA decision to release oil from strategic reserves did not have any impact on prices. Put simply, traders have completely ignored this effort to cool prices.

Physical oil traders around the globe are busy searching for any oil they could find, which is bullish for oil prices.

From the technical point of view, WTI oil is trying to settle above the resistance level at $103.00 – $104.00. In case this attempt is successful, WTI oil will head towards the next resistance, which is located in the $108.00 – $109.00 range.

RSI shows that Brent oil is extremely overbought, but technical factors take a back seat when the world’s key energy route is de-facto closed.

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