The price of natural gas is on the rise, up to $1.845, which puts the price right back to where it was on Thursday.

Current gas prices are nearly at a six-month high, but that has not assuaged fears that there is an excess of oil and a lack of demand. So, US oil producers are not hurrying to up their production levels.

The natural gas arm of the energy sector is in a tough spot at the moment. Even though the global economy is slowly improving, natural gas sales continue to stagnate. There is little need for more gas production, especially as many countries prepare to enter the warmer summer months.

As natural gas prices increase, crude oil prices are dropping, down 0.45% today. The major concern on the crude oil front, outside of oversupply issues, is the attacks in the Middle East and in Russia that have damaged the oil trade.

Russian refinery attacks have been some of the biggest victories for Ukraine as they target the Russian energy sector. The most recent was a Lukoil refinery that was hit in March of this year, resulting in a 50% production loss.

Typically, war in the Middle East will make oil prices spike, but that has not been the case for much of the fighting going on now between Hamas and Israel. The primary reason for that is simply that oil refineries and other energy facilities have not been the major targets of the attacks in those areas.

Outlook for Oil and Gas

Our crude oil price forecast estimates that the price will continue to drop over the next few weeks. Oversupply issues will continue to rear their head in this sector, making increased oil production unnecessary.

Brent oil prices have exceeded the expectations made by many analysts back in 2023. The experts at the US Energy Information Administration said that Brent oil prices would climb to $82 per barrel, but the cost of a barrel is at $90 today. That price is slowly dropping, but it may stay between $90 and $85 for the next few weeks.

Natural oil prices are currently increasing, and they will likely flatten out very soon and establish a level around $1.85 for the next couple of weeks. We expect to see major movement from oil and gas as we get deep into the summer months as governments gear up for colder weather ahead.