Natural Gas and Oil Forecast: IEA Surplus Outlook vs. Geopolitical Risks

Adam

Summary:

Oil and gas markets face surplus forecasts versus geopolitical risks. Natural gas holds bullish above \$2.91; WTI and Brent trade in tightening triangles, with upcoming breakouts likely to set sharp directional moves.

Market Overview

WTI crude slipped to $64 per barrel on Friday, marking its first monthly decline in four, though still on track for a second weekly gain. Energy markets remain volatile as geopolitical tensions and supply disruptions compete with forecasts of a global surplus.

The IEA projects supply will outpace demand in the coming quarters, while OPEC+ moves to restore capacity. Seasonal demand is also easing with the end of the US driving season.

With Russian exports set to fall and pipeline flows resuming elsewhere, the balance of risks leaves oil and gas prices finely poised heading into September.

Natural Gas Price Forecast

Natural Gas (NG) Price Chart

Natural gas futures are trading near $2.97, consolidating after breaking out of a falling channel on the 4-hour chart. The breakout above $2.91 marks a key shift, as this level now acts as support. If buyers hold above it, momentum could drive prices to $3.04, with further upside potential toward $3.14.

Candlesticks show long lower shadows on recent dips, signaling buying interest near support. The structure of higher lows adds weight to the bullish bias. However, a failure to hold $2.91 could invite sellers back, exposing $2.80 and deeper support at $2.70.

For traders, the setup is straightforward: watch for strength above $2.91 to confirm continuation higher, while protecting against downside risk with stops just below this support.

WTI Oil Price Forecast

WTI Price Chart

WTI crude oil is trading near $64.09, moving within a tightening symmetrical triangle on the 4-hour chart. The price is being compressed between a rising trendline from $61.50 and descending resistance around $65.10. This setup suggests a breakout is approaching.

Key support rests at $62.96, with deeper levels at $61.54 if selling pressure builds. On the upside, a decisive close above $65.12 could open the path toward $65.79 and $66.46. Candlesticks show repeated rejection near $64.40, indicating hesitation from buyers.

Brent Oil Price Forecast

Brent Price Chart

Brent crude is trading around $67.47, consolidating within a symmetrical triangle on the 4-hour chart. Price is being squeezed between rising trendline support near $66.36 and descending resistance at $68.47, pointing to an upcoming breakout. A close above $68.47 could trigger momentum toward $69.14 and potentially the $70.00 mark.

On the downside, slipping under $66.36 may expose support at $65.58. Candlesticks show rejection near $67.70, suggesting hesitation among buyers. The tightening price action, combined with higher lows forming against flat resistance, indicates mounting pressure for direction.

Until a breakout occurs, traders should expect choppy movement, but once resolved, the move could be sharp given the narrowing range.

Source: fxempire

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