Crude oil prices rebound following sharp selloff after United States midterms

Crude oil prices rose on Thursday as commodity traders evaluated geopolitical risks following recent political developments in the United States. Brent crude settled nearly 4% higher at above $98 a barrel, recovering from a loss of almost 9% on Wednesday. West Texas Intermediate crude increased by 2.7%, according to Rigzone News. CNBC reported that oil prices surged as market investors assessed the future of the conflict involving Iran and ongoing attacks on oil tankers. [1][5][9]

The price fluctuations followed a strong selloff earlier in the week. EnergyNow reported that oil markets rebounded after a historic drop while investors weighed the fallout from the election in the United States alongside the risks of the Iran war. Rigzone News reported that the market decline occurred after Democrats won control of Congress in a victory that altered expectations surrounding the conflict. Barchart.com reported that crude prices had fallen on hopes of a quick end to the war, while MarketWatch noted that the election results rewrote political strategy regarding Iran. [1][2][3][6][8]

The military conflict, now in its ninth month, has created broad political consequences in the United States. President Donald Trump stated that he has no immediate plans to launch new military strikes against Iran, although he added that the country remains prepared for a potential escalation, Rigzone News reported. Democrats have pledged to end the military conflict after voters punished the Republican Party at the polls, according to Rigzone News. [1]

The conflict has caused severe disruptions to international energy trade. A global fuel crisis emerged after the closure of the Strait of Hormuz, which normally handles more than 20% of global oil trade, alongside attacks on energy facilities in Iran and Gulf Cooperation Council countries. The resulting supply losses led to elevated global crude prices and widespread shortages of petroleum products, liquefied natural gas, and urea fertilizer. [10]

Energy companies have recorded significant financial shifts during the conflict. EnergyNow.com reported that Shell saw its profit more than double to $9.8 billion, representing its second highest profit on record, as higher energy prices driven by the war boosted corporate earnings. [4]