Is this an oil slinger for a Magnum or LA
I did a cam swap and I got one of those felt washers in the kit, it took me a bit to figure it out.
I tried putting it in the balancer and it fit like a glove, and didn't hinder the balancer from going on.
Try fitting it in there, and then slide it over the crank snout to check for fit, I bet it fits perfect.