In this news, we discuss the Oil rises after Trump falsely claims victory in tight U.S. election.
LONDON (Reuters) – Oil prices rose on Wednesday, but reduced earlier gains after President Donald Trump falsely claimed victory in a tight US election with millions of votes yet to be counted and the end result yet to be clear.
A Trump victory is seen as optimistic for oil due to sanctions against Iran and its support for Saudi Arabia-led oil production cuts to support prices.
A contested outcome and prolonged uncertainty is seen as the most bearish outcome for oil and the markets in general, while a win by Joe Biden would be viewed as bearish to neutral due to his support for green policies and a stance. gentler on Iran.
West Texas Intermediate rose 40 cents, or 1%, to $ 38.06 a barrel at 2:42 p.m. GMT. It had previously hit highs of $ 38.92.
Brent rose 51 cents, or 1.3%, to $ 40.22 after hitting highs of $ 40.97.
Trump falsely claimed to have won after his Democratic challenger Biden said he was confident he would win a contest that will only be resolved when a handful of states have finished counting the votes in the next few hours or days.
“This (potential Trump victory) is optimistic for oil because OPEC + can continue to cut without fear that Iranian oil supplies will return to the market anytime soon,” SEB’s Bjarne Schieldrop said.
Investors turned to a greater likelihood of US policy stalling, with US Treasuries and the dollar strengthening and tech stocks soaring. [MKTS/GLOB]
Oil prices have also been supported by the possibility that OPEC producers and Russia may consider postponing a planned increase in OPEC + oil production from January as a second wave of coronavirus suffocates a resumption of fuel demand.
The Organization of the Petroleum Exporting Countries (OPEC) and its Russian-led allies, a group known as OPEC +, previously agreed to ease cuts by 2 million barrels per day from the 7 , 7 million bpd current from January.
More lockdowns could limit increases in oil prices. Italy, Norway and Hungary have tightened the limits on coronaviruses, after Britain, France and other countries.
Chart: Global oil supply and demand –
Reporting by Noah Browning and Aaron Sheldrick, additional reporting by Ron Bousso. Editing by Jane Merriman and Elaine Hardcastle
Original © Thomson Reuters
Originally posted 2020-11-04 07:46:09.