Oil Price Forecast: Risk of Further Fall as Supply Exceeds Demand
World oil prices continue to be under pressure from abundant supply and geopolitical instability, and are likely to fall further if important support levels are broken.
Oil market faces oversupply risk
WTI oil prices have fallen for four consecutive sessions, currently hovering around $62/barrel. The main reason comes from Iraq's plan to restore exports of about 230,000 barrels/day from the Kurdistan region, bringing the total export volume under the OPEC+ agreement to 3.40 - 3.45 million barrels/day. This makes the global supply-demand balance more tense.
Europe is also considering tightening LNG supplies and sanctioning energy tankers, adding further uncertainty to already fragile supply chains. These factors are putting significant downward pressure on near-term oil price forecasts.
WTI oil price developments
WTI is currently trading at $61.90 per barrel, just above the support level of $61.71. The downside momentum remains strong as the RSI is low and the price is below key moving averages. A break below this support level could see the price slide to $61.19 or even to $60.70.
Conversely, to regain balance, WTI needs to break above $62.70 and then retest the $63.80 area – which is considered a strong resistance. However, the current trend is still bearish.
Brent oil price forecast
Brent crude oil is trading around $66.15 a barrel after breaking out of a symmetrical triangle pattern, signaling a continuation of the downtrend. The nearest support is at $65.73, further at $65.07. If these levels fail to hold, the price could fall to $64.20.
On the other hand, the recovery will only be clearer if Brent regains $66.67 and closes above $67.50. Then the target can be extended to the $69.50 area. For now, the market is still under more selling pressure than buying.
Natural gas price forecast
Natural gas is trading at $2.80, well below key moving averages. The downtrend remains dominant, with immediate support at $2.77 and further support at $2.70. Only a recovery above $2.94 could see the market re-target the $3.01 area.
