Oil Little Changed On Election Day

NEW YORK (DTN) -- New York Mercantile Exchange oil futures were little changed though lower at the start of regular trade Tuesday morning as Americans head to the polls to elect their president for the next four years.

There's a great deal of anxiety, with the U.S. economic and energy future at the center of the elections. The market also doubts the Organization of Petroleum Exporting Countries is committed to cutting production at its Nov. 30 meeting in Vienna.

Analysts said investors are hedging against any surprises, with some unwinding their recent bets against risky assets such as crude oil and equities as the race between Democrat Hillary Clinton and Republican Donald Trump is close.

The next president will have to implement economic and energy policies that could impact the nation's oil supply and demand for the next four years or more.

Public opinion polls show Clinton with a slight advantage, but the momentum is with Trump. Clinton is seen by investors as offering certainty and stability while Trump has promised to unshackle the oil industry from stifling regulations.

In its latest report on energy politics issued this morning, Barclays Capital says that, "In the case of a Hillary Clinton win, she will aim to build upon the environmental legacy and regulatory initiatives of the Obama Administration, while a Trump administration will seek to dismantle it."

At 9:00 AM ET, NYMEX December West Texas Intermediate crude oil futures were down 17cts at $44.72 bbl. ICE January Brent futures were also down 17cts at $45.98 bbl.

In product futures trade, NYMEX December ULSD futures eased 0.77cts to $1.4329 gallon while NYMEX December RBOB futures contract was 0.74cts lower at $1.3636 gallon.

On Wall Street, equities were lower on risk-off trade and the dollar is also lower.

On fundamentals, the market is awaiting the November short-term outlook report by the U.S. Energy Information Administration due at midday, with its weekly oil inventory report due out Wednesday morning.

For the week-ended Nov. 4, a survey of analysts by Schneider Electric showed a 200,000 bbl build in domestic crude oil stocks. The survey also forecasted a gasoline stocks draw of 1.2 million and a decline in distillate fuel stocks of 1.8 million.

Internationally, OPEC continues to be a main focus. The cartel is struggling to convince its 14 members to support cutting output. OPEC is scheduled to its short-term demand estimate for November on Friday (11/11).

In October, OPEC estimated world oil demand in 2016 increasing by 1.24 million bpd to 94.40 million bpd after upward revision of 10,000 bpd from its September MOMR. OPEC crude production, based on secondary sources, increased by 220,000 bpd in September to average 33.39 million bpd, said the report.

George Orwel can be reached at george.orwel@dtn.com

(CZ)