WTI Slumps On Closer Us-Iran Nuclear Deal News

The WTI crude oil has been selling off sharply in recent trade on headlines suggesting that a US/Iran nuclear deal is near. A deal that saw US sanctions on Iranian oil exports removed could add well over 1M BPD to global markets. WTI has fallen $2.0 in the last hour and is now down $3.50 from earlier session highs near $95.00.

Oil has been selling off sharply in recent trade as headlines pick up regarding a possible deal between the US, Iran and other world powers that would revive the 2015 nuclear pact and end US sanctions on Iranian oil exports.

Front-month WTI futures have slipped more than $2.0 in the last hour and are now down more than $3.50 versus earlier session highs near $95.00. On the day, WTI is now just over 50 cents lower. WTI will now be eyeing a test of support in the form of a long-term uptrend that has been in play all year so far, with any break below likely to be followed by a swift drop back under $90.00 and towards support in the $88.00s.

Iran’s top nuclear negotiator Ali Bagheri Kani tweeted on Wednesday that, following weeks of intensive talks, the JCPOA participants including the US and Iran are closer than ever to an agreement.

Shortly after Kani’s tweet, the US State Department said that the US is in the midst of the very final stages of talks with Iran reviving the 2015 nuclear deal. A deal would open the door for well over 1M barrels per day in addition Iranian exports to return to global markets.

While chatter about an imminent return to the 2015 nuclear deal and return of Iranian supply will likely weigh on markets in the short-term, analysts said, Russia/Ukraine tensions remain another wildcard.

The latest headlines on this front have not been positive, with government and intelligence officials in the US and various NATO nations warning that there is no evidence yet that Russia is reducing its military presence on Ukraine’s border.

Intelligence officials have been warning about the risk that a limited attack in Eastern Ukraine’s Donbas region remains a distinct possibility.