WTI consolidates the rally near $ 70.50 amid Venezuela, Iran worries

• Bulls take a breather after a rally to $ 70.64, multi-year tops.
• Eyes on the impending US decision on Iran sanctions.

WTI (oil futures on NYMEX) rallied to the strongest levels since November 14 beyond $ 70.50 levels earlier today, now consolidating the bullish move, as investors await fresh developments around the Iranian nuclear deal for the next push higher.

The black gold is seen trading almost a percent higher so far this Monday, underpinned by the

renewed concerns of tightening supplies, as the economic crisis deepens in Venezuela. Venezuela’s oil output has halved since the early 2000s to just 1.5 million barrels per day (bpd), as cited by Reuters.

Also, an impending decision on whether the US will re-impose sanctions against Iran continues to remain oil-supportive. Trump is unlikely to announce an extension to the sanction waivers when they expire on May 12, which would likely result in a reduction of Iran’s oil exports.

Meanwhile, the barrel of WTI also derives support from the latest comments delivered by the Saudi Arabian Energy Minister Al-Falih, as he reiterates his pledge to stabilize the oil markets.

In the week ahead, markets will continue to closely track any updates on the Iran nuclear ahead of the US weekly crude supplies report.

WTI Technical Levels

Omkar Godbole, Analyst at FXStreet notes: “Last week's bullish outside-week candle (engulfed previous week's doji) signals continuation of the rally from the June 2017 low of $42.06, also adds credence to the ascending (bullish) 5-week moving average (MA) and the 10-week MA and has opened the doors to $75.00 - $75.21 (100-month MA).”

“Only a daily close below the ascending (bullish) 10-day MA would neutralize the immediate bullish outlook. A daily close below $66.86 (May 1 low) would indicate a short-term bullish-to-bearish trend change,” Omkar adds.