Oil and Natural Gas: The Price Decline

• The oil price fell further yesterday, failing to stay above $88.00, followed by a drop to the $84.50 level.
• The price of natural gas continues to decline today.
• The market found some support amid fading expectations of a return to Iranian oil, as some Western leaders downplayed the prospect of renewing the nuclear deal with Tehran.

Oil chart analysis

The oil price fell further yesterday, failing to stay above $88.00, followed by a drop to the $84.50 level. During the Asian session, the price of oil fell to the $84.00 level. The price manages to consolidate and climb above the $85.00 level. We need a positive consolidation to the $86.00 resistance level to continue the bullish trend. Then we need to see the break prices above. We have additional resistance in the MA50 and MA200 moving averages. And potential higher targets are $87.00 and $88.00 levels. We need a negative consolidation and a return to support at the $84.00 level for a bearish option. A price break could take us down to the September $81.00-$82.00 support zone.

Natural gas chart analysis

The price of natural gas continues to decline today. Today’s low was at the $8.05 level. After that, we saw a recovery to the $8.30 level. Additional resistance at that point creates the MA200 moving average for us. The price may now resume the bearish trend again. We need to see a break below the $8.00 support level. And potential lower targets are $7.80 and $7.60 August low. For the bullish option, we need a new positive consolidation and to try again to climb above the $8.40 level. Then we need to stay above to have a chance of further recovery. Potential higher targets are $8.60 and $8.80 levels.

Market Overview

The market found some support amid fading expectations of a return to Iranian oil, as some Western leaders downplayed the prospect of renewing the nuclear deal with Tehran. Oil prices could also find support in the fourth quarter as OPEC+ members are likely to discuss production cuts at their October meeting, as well as how Europe will deal with the energy crisis amid uncertainty over oil and gas supplies from Russia.