Oil Price Fundamental Daily Forecast – Up on Speculation U.S. Could Reimpose Sanctions Against Iran

U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are trading slightly higher early Monday, boosted by a decline in U.S. drilling activity and the possibility the U.S. could reimpose sanctions against Iran.

At 0646 GMT, May WTI crude oil is trading $65.24, up $0.30 or +0.46% and June Brent crude oil is at $69.76, up $0.42 or +0.61%.

On Thursday, energy services firm Baker Hughes reported U.S. drillers cut seven oil rigs in the week to March 29, bringing the total count down to 797. It was the first time in three weeks that the rig-count fell.

There is also talk circulating that the U.S. government is close to deciding whether or not to scrap or maintain the current deal with Iran. Reimposing sanctions on Iran will likely generate a bullish response from traders because it will eventually lead to a cut in supplies from the region.

The price action could be muted on Monday due to bank holidays around the world, especially in Europe, which will still be on Easter holiday.

May WTI Crude Oil is currently trading on the strong side of its short-term pivot at $65.14. This price is likely to control the price action of the market today. A trade through $66.55 will negate last week’s potentially bearish closing price reversal top and signal a resumption of the uptrend. A trade through $63.72 will change the main trend to down.

June Brent Crude Oil is trading on the strong side of its short-term pivot at $69.18, giving the market a bullish tone early Monday. A trade through $70.39 will signal a resumption of the uptrend. The trend changes to down on a trade through $67.98.