Natural Gas and Oil Forecast: Inventory Data Looms—Will Brent Extend Toward $98?
Author: Arslan Ali
Published: July 22, 2026
Key Points
- Traders are anticipating new U.S. inventory data amidst ongoing geopolitical risks affecting global crude supply.
- WTI crude oil has surpassed major trendline resistance, with a short-term target of $88.66.
- Brent crude is experiencing a bullish breakout, with buyers defending the $91.82 level and targeting $98.03.
- U.S. LNG exports are projected to reach 17.4 Bcf/d in 2026, indicating strong long-term demand for natural gas.
- Natural gas prices remain constrained below key moving averages, leading to a range-bound market until a breakout occurs.
Market Overview
As traders await a new U.S. inventory report to assess the balance of supply and demand, the oil market is heavily influenced by geopolitical tensions. The U.S. Energy Information Administration (EIA) has forecasted a draw of 500,000 barrels in U.S. commercial crude supplies for the week ending July 17, marking a second consecutive decline. The upcoming report is highly anticipated.
Geopolitical risks are elevated due to military actions in the Middle East and North Africa, particularly involving the U.S. and Iran, as well as threats from Yemen's Houthis. These conflicts are disrupting navigation through critical waterways like the Red Sea and the Strait of Hormuz. Additionally, the Caspian Pipeline Consortium has halted crude intake from Kazakhstan due to missile strikes near its terminal, and Saudi crude exports have decreased for three consecutive months.
Natural Gas Fundamentals
The EIA expects U.S. LNG exports to average 17.4 Bcf/d in 2026, up from 15.1 Bcf/d in 2025, driven by increased export capacity and resilient global gas demand. U.S. crude production is projected to average 13.8 million barrels per day (bpd) this year, with an increase to 14.0 million bpd by 2027.
Technical Analysis
Natural Gas (NG)
Natural gas prices are currently trading around $2.88, remaining below the 50-EMA at $2.93 and the 100-EMA at $3.00, indicating that sellers are in control of the short-term trend. Immediate resistance levels are at $2.90, $2.95, and $3.02, while support levels are at $2.82, $2.78, $2.73, and $2.66. The RSI is neutral at approximately 48, suggesting a lack of clear direction.
WTI Crude Oil
WTI crude oil has broken above its multi-week trend, with prices currently at $85.25, above the 50-EMA at $79.78 and the 100-EMA at $77.77. The next resistance level is at $88.66, followed by $93.71 and $95.00. Support levels are at $83.48 and $80.34. The RSI is around 68, indicating strong momentum but nearing overbought territory.
Brent Crude Oil
Brent crude oil continues its upward trend, trading at $92.13, above the 50-EMA at $85.55 and the 100-EMA at $82.82. The next resistance level is at $98.03, with support at $91.82, $87.34, $84.12, and $80.83. The RSI is at 72, suggesting strong momentum, but potential for slower gains moving forward.
Conclusion
The oil market is poised for potential upward movement, particularly for Brent crude, as long as it remains above key support levels. Traders should monitor geopolitical developments and upcoming inventory data closely, as these factors will significantly influence market direction.