Oil set for sharp weekly drop after US midterms raise hopes of more Mideast crude exports
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LONDON, Nov 6 : Oil prices were set for a sharp weekly fall after the midterm election losses of US President Donald Trump's Republican Party raised hopes of a de-escalation in the US-Israeli war on Iran, though attacks on vessels in the Middle East continue to provide a floor for the market.
After early gains in a see-saw session on Friday, Brent crude futures for January were down 74 cents, or 0.8 per cent, to $97.55 a barrel by 0826 GMT. US West Texas Intermediate futures dipped 73 cents, or 0.8 per cent, to $89.79.
The Brent contract is on track for a 16 per cent decline this week, which would be its steepest weekly percentage fall since the start of the COVID-19 pandemic and its biggest in absolute terms in LSEG data going back to 1988.
WTI is set for a more than 13 per cent decline.
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The oil price slide comes against the backdrop of a dramatic rout in technology stocks.
A potential Iran war de-escalation could lead to more crude exports out of the region, with signs of an emerging crude oil glut reinforced by spot premiums for Middle Eastern crude benchmarks returning to levels reached before the conflict.
Oil prices fell 8 per cent on Wednesday alone after the Democrats swept the US midterm elections, settling at two-month lows.
However, prices rebounded on a surge in tanker attacks in the Gulf and the Strait of Hormuz, renewing concerns over supply flows from the region.
Data from Britain's maritime security agency UKMTO suggested that attacks on oil-carrying ships are still running at close to record pace.
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