Brent crude pushed lower after tumbling more than 8% in the previous session as investors bet that a Democratic sweep in the US midterm elections could accelerate efforts to end the war in the Middle East. The global benchmark traded near $94 a barrel, while West Texas Intermediate fell toward $87 after its biggest loss since May.
Vice President JD Vance said voter frustration over the war and the US-Israel relationship doomed Republicans in the elections. Senate Minority Leader Chuck Schumer, a Democrat, pledged to end the conflict, now in its ninth month. Democrats won control of both chambers of Congress in the midterms, dealing a major setback to President Donald Trump and his Republican Party. The sweep gives them greater leverage over government spending, potentially constraining the administration's ability to prosecute the Iran conflict.
Brent had rallied to a six-month high in October as Trump threatened renewed strikes on Iran after the midterms. While polls were still open, Trump told the Financial Times he had no immediate plans to ramp up attacks, and later conceded it's "largely true" Republicans lost because of the war. Despite the conflict, crude exports from the Persian Gulf have revived, putting pressure on Middle East prices, although shipments of oil products remain constrained. Those disruptions, along with escalating Ukrainian attacks on Russian refineries, have pushed gasoline and diesel prices higher.
Dennis Kissler, senior vice president for trading at BOK Financial Securities Inc., said larger Middle East crude exports and Trump's restraint are keeping pressure on crude prices for now. He added that Democratic control of Congress "could also tighten US military spending" and bring an end to the war sooner. North Sea crude prices slumped to fresh lows, while European natural gas tumbled. Tightness persists in fuel markets, however: US distillate stockpiles, which include diesel, dropped below 100 million barrels last week, the lowest level since 2003, according to government data. Nationwide crude inventories fell for a fifth week.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing