Natural Gas and Oil Forecast: WTI, Brent Pull Back as Iran Sanctions Intensify

Published: August 24, 2026

Author: Arslan Ali

Key Points

• Tighter U.S. sanctions on Iranian crude buyers could further constrain Middle East exports and increase global oil supply risks.
• Hormuz uncertainty remains a significant geopolitical driver as global crude inventories and available Gulf exports remain constrained.
• Higher LNG prices are beginning to threaten demand as buyers replenish supplies following disruptions to Qatari exports.
• WTI remains technically constructive above $84.03, but repeated rejection at $87.42 raises the risk of a double-top formation.

Oil Market Overview

The oil market is currently influenced by the Strait of Hormuz and increased U.S. pressure on Iran. The latest sanctions are described as the most aggressive since the 1980s, targeting countries and companies purchasing Iranian crude. Iran has started limiting crude offers to China, leading to a decline in global crude inventories.

The International Energy Agency (IEA) forecasts a drop of 4.3 million barrels per day (bpd) in global supply by 2026, with Gulf exports still significantly below pre-war levels. Global stocks have decreased by 69 million barrels in July alone, totaling 410 million barrels below the levels at the start of the war.

Despite tightening supplies, the IEA also predicts a slowdown in global oil demand by 1.6 million bpd.

LNG Market Dynamics

In contrast, the LNG market is experiencing a different trend. The U.S. has exported 73 million tons of LNG by July, a 23% increase from the previous year. However, rising LNG prices, now above $22 per MMBtu, are causing demand destruction as buyers replenish supplies disrupted by the Qatari blockade.

Domestically, U.S. gas supply remains robust, with working gas in storage at 3,169 billion cubic feet (Bcf), above seasonal expectations.

Technical Analysis

Natural Gas (NG)

Natural gas is trading at $2.72, having broken beneath a rising trendline. The price is also below the 50 EMA at $2.76 and the 100 EMA at $2.75, indicating continued pressure on the short-term outlook. Support is seen at $2.71, with further support at $2.67 and $2.64. A rally is contingent on reclaiming the $2.77 price zone.

WTI Crude Oil

WTI crude oil is currently trading at $85.22, facing resistance at $87.42. The repeated failures to break this level raise the risk of a double-top pattern. Immediate support is at $84.03, with further support between $80.82 and $77.86. The bullish trend remains intact as long as prices stay above $84.03.

Brent Crude Oil

Brent crude oil is trading at $91.05, having been rejected at $94.78. It is currently testing rising support between $90.60 and $91.00. The overall trend remains bullish as long as it holds above the 50 EMA at $90.73 and the 100 EMA at $88.92. Immediate support is at $90.73, while resistance is at $94.78 and $97.84.

Conclusion

The energy market is navigating through a complex landscape of geopolitical tensions, particularly regarding Iran, and fluctuating supply and demand dynamics. The technical outlook for both natural gas and crude oil suggests cautious monitoring of key support and resistance levels as traders position themselves for potential market movements.