DTN Oil Update
Oil Down Again as US Election Spells Iran War Oversight
SECAUCUS, N.J. (DTN) -- Crude futures fell for a third straight session Wednesday as traders weighed the outcome of the U.S. midterm elections that led to sweeping wins for Democrats who could pose wide-ranging challenges to the Trump administration's war against Iran and other energy policies.
By 8:53 a.m. EST, NYMEX WTI crude for December delivery fell $2.55, or 2.60%, to $93.54 bbl after an intraday low at $93.24 bbl. WTI has lost about 10% over the past three sessions.
ICE Brent for January delivery dropped $2.58, or 2.50%, to $101.02 bbl, off a session bottom of $100.65 bbl.
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Downstream, ultra-low sulfur diesel (ULSD) for December delivery eased $0.1010, or 2.35%, to $4.4296 gallon after dipping to $4.4100.
RBOB for December delivery retreated $0.0576, or 1.97%, to $2.8779 gallon, near its intraday floor of $2.8690.
The U.S. Dollar Index slid 0.531 points to 101.195 against a basket of foreign currencies.
Democrats retook control of both the House of Representatives and the Senate in Tuesday's, Nov. 3, midterm elections, securing at least 225 House seats to surpass the 218-seat majority threshold and taking 54 seats in the 100-member Senate. Democratic leaders are expected to challenge President Donald Trump under the War Powers Resolution in January, seeking to mandate explicit Congressional authorization for further military action in the Strait of Hormuz following recent U.S. strikes on Qeshm Island.
While presidents can invoke emergency powers to initiate short-term military strikes, Article I of the Constitution reserves the authority to declare war to Congress.
"Trump can maintain U.S. sanctions on Iranian oil via executive order, but a Democratic-controlled Congress can also push for diplomatic de-escalation to secure commercial vessel transit through the Strait of Hormuz," said John Kilduff, partner at New York energy hedge fund Again Capital.
Diplomatic efforts in the Middle East remain fluid. Iran and Washington are reviewing fresh proposals mediated by Qatar aimed at preventing wider conflict, though Iranian officials told Reuters that the two sides remain far from an agreement.
Concerns over shipping security persist after another oil tanker was targeted in the Strait of Hormuz, maintaining underlying supply risk across the global oil market.
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