Before the outcome of the US election, oil trades in a narrow range

Oil prices remained steady on Tuesday, fluctuating within a narrow range as traders await what is anticipated to be a highly competitive U.S. presidential election. This comes after prices rose more than 2% in the previous session, spurred by OPEC+'s decision to delay a planned production increase until January.

As of 0841 GMT, Brent crude futures edged up by 16 cents, or 0.2%, reaching $75.24 per barrel. Meanwhile, U.S. West Texas Intermediate crude increased by 18 cents, or 0.3%, to $71.65 per barrel.

"We are currently in a period of calm before the storm," commented IG market analyst Tony Sycamore.

Support for oil prices was driven by the announcement from the Organization of the Petroleum Exporting Countries and their allies (OPEC+) on Sunday, which postponed a production increase originally scheduled for December due to weak demand and growing non-OPEC supply putting downward pressure on the market.

However, risk-taking among traders remains subdued as they navigate a busy week ahead, featuring the U.S. election, the Federal Reserve's policy meeting, and China's National People's Congress (NPC) meeting. Market strategist Yeap Jun Rong from IG noted that many traders are opting to remain on the sidelines during this period.

Current polls indicate a tightly contested U.S. presidential race, and any delays in election results or potential disputes could pose short-term risks to broader markets, potentially prolonging uncertainty, Yeap added.

Additionally, there is anticipation surrounding China's NPC meeting for potential clarity on fiscal stimulus that could enhance the country's demand outlook. However, any strong commitments are unlikely to emerge until after the U.S. presidential election results, which will likely keep oil prices in a near-term holding pattern.

In October, OPEC oil production experienced a rebound as Libya resumed output, according to a Reuters survey. However, Iraq's efforts to comply with its pledged cuts to the broader OPEC+ alliance limited the overall increase.

Iran is also expected to contribute more oil to the market, with the Iranian oil ministry's news website Shana reporting that Tehran has approved a plan to boost production by 250,000 barrels per day.

In the U.S., a late-season tropical storm forecasted to strengthen into a category 2 hurricane in the Gulf of Mexico this week could potentially disrupt oil production by approximately 4 million barrels, according to researchers.

As traders await the release of U.S. weekly oil data on Wednesday, a preliminary Reuters poll indicated that U.S. crude stockpiles likely increased last week, while inventories of distillate and gasoline saw a decline.

 

 

 

 

 

 

 

 

 

Paraphrasing text from "Reuters" all rights reserved by the original author.