Oil prices traded in a narrow range on Tuesday amid an unusually close performing US presidential election, after rising more than 2% in the previous session as OPEC+ delayed plans to increase output in December.
Brent crude futures were down 3 cents, or 0.04%, at $75.05 a barrel by 0600 GMT, while WTI crude was down 4 cents, or 0.06%, at $71.43 a barrel.
Oil prices were supported by OPEC+’s announcement on Sunday that it would delay production increases by a month from December as weak demand and rising non-OPEC supply weigh on markets.
A busy period, including the US election, the Federal Reserve’s policy meeting, and China’s National People’s Congress (NPC) meeting, keeps many investors calm and limits risk-taking.
For now, polls suggest the two candidates in the US presidential race will be close, and any delay or even disagreement in the election results could pose short-term risks to broader markets.
China’s NPC meeting is also being eyed for any clarity on fiscal stimulus to improve the country’s demand outlook.
Still, it is unlikely we will see a strong commitment before the US presidential results, which will keep oil prices in a short-term waiting game.
Meanwhile, OPEC oil production rebounded in October as Libya restarted production, but gains were capped by Iraq’s efforts to meet cuts it has given to the broader OPEC+ alliance.
More oil could come from OPEC producer Iran after Tehran approved a plan to increase output by 250,000 bpd.
Meanwhile, a late-season tropical storm in the Gulf of Mexico, expected to become a Category 2 hurricane in the US this week, could cut oil output by around 4 million bpd, researchers said.
Technically, there are those who expect crude oil to break above the $71.50/$72.50 resistance to eliminate downside risks.
All of this suggests that there will be no struggle to move higher in the short term.
A preliminary survey conducted on Monday ahead of weekly U.S. oil data due Wednesday showed U.S. crude oil inventories likely rose last week, while distillate and gasoline inventories fell.
