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

• New U.S. sanctions targeting Iranian crude buyers are the most aggressive since the 1980s, with global crude inventories down 410 million barrels from pre-2022 war levels and Gulf exports 8.3 million bpd below 2022 levels
• WTI crude traded at $85.22 after rejection at $87.42 resistance, facing double-top formation risk while maintaining support above $84.03; Brent tested rising support at $91.05 after rejection from $94.78
• U.S. LNG exports surged 23% to 73 million tons by July 2026, driving prices above $22 per MMBtu and sparking demand concerns, while domestic natural gas storage remains above seasonal norms at 3,169 Bcf

Market Summary: Oil Pulls Back Amid Iran Sanctions and Supply Concerns

Key Market Movements

WTI crude fell 1.05% to $85.22, while Brent declined 0.69% to $91.05. Natural gas edged up 0.45% to $2.78 as of August 24, 2026.

Primary Drivers

The U.S. is implementing its most aggressive Iranian sanctions since the 1980s, targeting countries and companies purchasing Iranian crude. Iran has already reduced crude offerings to China, and Middle East exports remain constrained, keeping supply tight. The Strait of Hormuz remains a critical geopolitical risk factor.

Supply and Demand Dynamics

The International Energy Affairs (IEA) forecasts a 4.3 million bpd drop in global supply by 2026, with Gulf exports 8.3 million bpd below pre-2022 war levels. Global inventories fell 69 million barrels in July, reaching 410 million barrels below pre-war levels. However, oil demand is expected to slow by 1.6 million bpd, tempering price pressures.

LNG Market Developments

U.S. LNG exports surged 23% year-over-year to 73 million tons through July. Prices climbed above $22 per MMBtu on both sides of the Atlantic as buyers replenished supplies following Qatar blockade disruptions, threatening demand destruction. U.S. domestic gas storage stands at 3,169 Bcf, above seasonal expectations.

Technical Outlook

WTI faces resistance at $87.42, with support at $84.03. A break below signals potential decline to $80.82-$77.86. Brent tests rising support at $90.60-$91.00 after rejection from $94.78. Natural gas broke its rising trendline, trading below key EMAs with support at $2.71-$2.67.

Market Implication: Supply constraints from Iran sanctions support prices, but weakening demand and technical resistance pose downside risks.