Oil prices held steady on Wednesday after a five-day upward streak, as the market closely watched the US presidential election and Hurricane Rafael’s threat to Gulf of Mexico production. West Texas Intermediate (WTI) traded near $72 per barrel, while Brent crude remained below $76. Rafael is endangering around 1.7 million barrels per day of output in the Gulf, with Chevron Corp. temporarily closing some oil and gas facilities in response.
As early votes are counted in the tight race between Kamala Harris and Donald Trump, the outcome could have significant implications for oil markets. A Trump victory may lead to eased restrictions on Russian oil, while a Harris win might signal tighter sanctions on Iranian oil, according to RBC Capital Markets LLC.
The US crude benchmark has climbed about 7% over the past week, reversing recent losses amid escalating tensions between Iran and Israel and a delay in OPEC+’s plans to restore production. Some traders are hedging against the possibility of $100 per barrel oil if Middle Eastern hostilities intensify post-election.
“US foreign policy is shaping up to be a potential factor for oil markets in the near term, particularly regarding Iran,” noted Vivek Dhar, an analyst at Commonwealth Bank of Australia. He also highlighted OPEC+’s ongoing struggles to maintain voluntary production cuts amid these uncertainties.
