Crude oil WTI finishing the week balanced as Iranian uncertainties loom

• The Iranian uncertainty is keeping crude prices perfectly balanced as traders are weighing options.
• German Chancellor Angela Merkel is in Washington this Friday in order to try to convince US President Donald Trump to preserve the Iranian agreement.

Crude oil West Texas Intermediate (WTI) is trading at around $68.19 a barrel on Friday as the WTI gained about 4.5% in April. 

German Chancellor Angela Merkel is in Washington this Friday in order to try to convince US President Donald Trump to preserve the Iranian agreement. The Iranian deal was reached in 2015. Economic sanctions on Iran were lifted in exchange for denuclearization. Trump, however, wishes to impose harsher sanctions on Iran and threaten to pull out of the deal on May 12 if changes are not made. A negative outcome could lead to oil supply disruption up to 350,000 barrels a day and could therefore potentially see crude prices spike higher.

On the data front on Friday Baker Hughes reported 825 drilling rigs this week from 820 last week. The reaction in oil has been pretty muted as WTI is trading in a small range close to 68.20. 

The Iranian uncertainty weighs on crude. The fact that WTI is about to close the week almost perfectly balanced is a clear sign that traders are waiting for information before moving on to the next big directional move.

Also worth mentioning is the decreasing oil output in Venezuela. Its crude production dropped from almost 2.5 million barrels per day (bpd) in early 2016 to roughly 1.5 million bpd in 2018. Tightening supply is bullish for oil.

Crude oil weekly chart

WTI is about to end the week perfectly balanced. Resistances remain the 68.30 pivot and the 69.00 figure while supports are priced in at 67.30 demand level and 66.55 swing high.