WTI pares losses as Iran nuclear deal progresses

The WTI crude oil recovered from reaching a daily low of around $86.29 and finished up 0.80%. US Department of State noted that a nuclear deal with Iran is closer, a headwind for oil prices. Oil traders are worried about a possible US recession and China’s economic slowdown.

Western Texas Intermediate (WTI), the US crude oil benchmark, recovered some ground on Monday, rallying late after the Wall Street close, up by 2.36%. At the time of writing, WTI is trading at $90.67 per barrel.

Price action hit a daily low at $86.29 PB, but as the New York session progressed and news that the OPEC+ saying that they will need to tighten output to stabilize the market augmented oil’s appeal. So WTI rallied since the mid-North American session and trades above its opening price.

Saudi Energy Minister Prince Abdulaziz bin Salman said OPEC+ could cut output against the possibility of a nuclear deal agreement with Iran, which could return the sanctioned country to the oil market.

Meanwhile, discussions between EU members and the US appear to be progressing, as stated by a US Department of State note, saying that a nuclear deal is closer now than It was two weeks ago.

Earlier during the day, oil prices tumbled on worries that China’s demand for oil could diminish, fueled by fears of a possible economic slowdown further cemented by the People’s Bank of China (PBoC) cutting rates from its main lender benchmark rate.

US recession fears are lingering in traders’ minds, with the US Federal Reserve set to continue tightening monetary policy as they battle to tame inflation towards its 2% goal.