Brent fell $8.94, or 8.6%, to $94.66 per barrel at 1:06 p.m. ET on Wednesday, after touching its lowest level since September 4, with traders pricing an end to the Iran war after the White House tied Tuesday’s midterm losses to the conflict. WTI dropped $8.01, or 8.3%, to $88.08. Brent traded near $118 on Friday.
Trump told Fox News on Tuesday night that “I think it’s the gasoline price” when explaining the Republican defeat. Vice President JD Vance wrote on X that the war was the reason for the losses, and that “any honest conversation about where we go from here must start there.” Trump had already told the Financial Times that Washington had no immediate plans to strike Iran.
BOK Financial’s Dennis Kissler said rising Middle East exports and Trump’s comments were keeping pressure on crude. He added that Democratic control of Congress could tighten U.S. military spending in the region and bring a peace deal sooner. Enverus’ Carl Larry warned that an escalation in Iran could come before a resolution. Supreme Leader Mojtaba Khamenei said in a written statement that U.S. hostility would persist whichever party holds power. The Houthis said they had targeted Riyadh’s King Khalid International Airport, and Saudi authorities did not confirm an attack.
Meanwhile, Qatari news outlet Al-Jadeed has once again reported significant progress in U.S.-Iran negotiations. The outlet made similar claims yesterday, suggesting Washington and Tehran had reached concessions on Iran’s nuclear program and frozen assets. Those reports were swiftly dismissed by a senior Iranian official, prompting oil prices to recover some of their earlier losses.
With diesel prices still at record highs, Washington is also taking steps to ease the pressure on fuel markets. The Energy Department said it would loan 300,000 barrels from the Northeast Home Heating Oil Reserve to four companies, equivalent to nearly a third of the stockpile. The move follows pressure from senators on both sides of the aisle after diesel prices surged above $6.50 a gallon. Heating oil futures subsequently dropped around 7%.
The selling overrode bullish supply data. U.S. crude inventories fell 900,000 barrels to 409.8 million in the week ended October 30, 4% below the five-year average. Distillate stocks dropped 3.6 million barrels to 13% below the five-year average, according to the EIA. Gulf exports of crude, condensate and products averaged 17.1 million bpd in October, down from 18.9 million in September and roughly three-quarters of pre-war levels, according to Vortexa.
By Charles Kennedy for Oilprice.com
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