Natural Gas, WTI Oil, Brent Oil Forecasts – WTI Oil Dives 6% As Traders Prepare For The Flood Of Oil From The Middle East

Natural Gas Attempts To Settle Above $3.25

Natural gas gains ground despite Qatar’s plans to rapidly restart LNG output after the reopening of the Strait of Hormuz. Traders believe that there is sufficient demand for U.S. LNG regardless of the situation in the Middle East. Weather forecasts provide additonal support to natural gas markets.

Currently, natural gas is trying to settle above the resistance level at $3.20 – $3.25. In case natural gas manages to settle above the $3.25 level, it will move towards the next resistance, which is located in the $3.40 – $3.45 range.

On the support side, a move below the $3.15 level will push natural gas towards the support at $3.00 – $3.05.

WTI Oil Tests Support At $76.50 – $77.00

WTI oil remains under strong pressure as U.S. and Iran prepare to sign a deal. The memorandum of understanding between the two countries would extend the ceasefire by two months and initiate the start of negotiations over Iran’s nuclear program. The text of the memorandum has not been published yet.

According to recent reports, Iran will get a sanctions waiver, and the country will start selling oil immediately. Iran is thirsty for cash due to damage dealt by internal mismanagement, war, and U.S. naval blockade. Thus, Iran will try to sell as much oil as possible and offer discounts to potential buyers.

Other countries in the Gulf, which have also suffered from the consequences of the U.S. military operation against Iran, have already rushed to sell oil. The Strait of Hormuz is not fully reopened yet, but various vessels have been seen in the nearby as countries prepare to sell oil.

Reports indicate that Iran will get significant financial incentives to reopen the Strait of Hormuz. The market believes that these incentives would be sufficient to maintain the ceasefire deal. It should be noted that the hardest part of any deal between U.S. and Iran, the nuclear program, has not been touched yet. The negotiations over Iran’s nuclear program could last for months. That said, traders ignore these risks and focus on the reopening of the Strait of Hormuz.

Currently, WTI oil is trying to settle below the support level at $76.50 – $77.00. In case this attempt is successful, WTI oil will head towards the next support, which is located in the $70.00 – $71.00 range. RSI remains in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

Brent Oil Tests New Lows

Brent oil retreats as traders traders bet that Gulf oil will flood the markets after the Strait of Hormuz is reopened.

In case Brent oil settles below the psychologically important $80.00 level, it will head towards the support at $77.00 – $77.50. A successful test of the support at $77.00 – $77.50 will open the way to the test of the next support level at $72.50 – $73.00.

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