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  • US sanctions on Iran failed to spark a bullish run on oil, and barrels are trading at near-term  lows.
  • Growing potential for global oversupply is expected to see crude prices continue drifting lower in the coming months.

Oil markets are struggling to bid prices higher in the face of a tidal wave of barrel supply from the US, Russia, and Saudi Arabia, and WTI is resuming trade just shy of the 63.00 level after a brief spike above 64.00 on Monday.

Tuesday sees US oil barrels trading back at near-term lows as energies traders struggle to find bullish confidence in the face of a significant overhang in global crude supply lines, despite the US’ new sanctions on Iran that came into effect yesterday. The US made an about-face in their Iran-blockade rhetoric late last week, looking to avoid fallout from sanctions on the Middle East country and promising a waiver system so oil purchasers can still access Iranian markets, and now oil prices are seeing significant downside pressure, with the US, Russia, and Saudi Arabia all producing barrels of crude at record or near-record levels.

WTI levels to watch

US oil barrels are trading into seven-month lows at 62.80 only four weeks after peaking at multi-year highs at 76.00, and support for Daily candles is seen at the low end of February’s bottoms near 58.00, with US crude trading to the downside of the 200-day moving average, currently sitting near 67.20.