WTI trades near $63 as markets get ready for Iran sanctions

• The United States’ sanctions against Iran oil exports will start on Monday
• The U.S. will announce 8 countries that will be exempted from sanctions.
• Baker Hughes rig count falls to 874.

Crude oil prices remained under pressure on Friday and the barrel of West Texas Intermediate fell to its lowest level since August 9 at $62.63.  

Although the United States’ sanctions against Iranian crude oil exports, which are scheduled to go into effect on Monday morning, are expected to weigh on the global supply, reports of the U.S. planning to exempt  eight countries didn’t allow crude oil prices to recover their recent losses. Commenting on this development,  Iran’s Deputy Oil Minister said that this action was a clear sign that the U.S. wouldn’t be able to pull out Iran’s oil from the market.

Later in the day, the U.S.  Secretary of State, Michael Pompeo, said that exemptions to eight countries would be temporary. “We will announce eight exempted jurisdictions on Monday, the EU will not receive a waiver,” Pompeo added. Despite these remarks, the WTI failed to make a meaningful recovery in the session. Meanwhile, the weekly report published by Baker Hughes Energy Services revealed that the total number of active oil rigs in the U.S. fell to 874 from 875 recorded a week ago.

“It seems as though all the worries about tightening supplies due to the loss of Iranian barrels in the market have dried up. On top of that, concerns regarding reduced global demand has also helped … the market continues to search for a bottom,”  Gene McGillian, director of market research at Tradition Energy in Stamford, Connecticut, told Reuters on Friday.

Technical outlook:  Crude Oil WTI Technical Analysis: Black Gold bears hit $63.00 a barrel