Oil prices fell for a fourth day as traders assessed whether U.S. midterm election results could reduce the risk of further escalation in the war with Iran. Brent was down 0.85% at $93.82 a barrel and U.S. crude fell 1.36% to $86.92.
Brent futures fell 80 cents, or 0.85%, to $93.82 a barrel, while U.S. West Texas Intermediate crude futures dropped $1.20, or 1.36%, to $86.92. Both benchmarks fell more than 8% in the previous session, settling at their lowest levels since August 31.
Traders weighed whether election losses for President Donald Trump's Republican Party could reduce the likelihood of further escalation and encourage a deal with Iran. Analysts said shipments through the Strait of Hormuz had recovered close to pre-war levels, though at higher cost, pushing the oil market back into surplus. JPMorgan estimated a surplus of 1.1 million barrels per day in September and 1.4 million in October.
Eurasia Group lowered its estimate for renewed U.S. strikes on Iran to 60% from 65%, and reduced the probability of a deal to 10% from 20%; it raised the chance of a continued standoff to 30% from 15%. The group said escalation could push Brent to $110-$125 a barrel. U.S. crude, gasoline and distillate inventories fell last week as demand reached its highest in a year, the Energy Information Administration said.
