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LONDON (REUTERS): Oil prices today (Thursday) fell as Democrat Joe Biden edged closer to the White House in a nail-biting US presidential election.
According to details, Brent crude fell $0.17, or 0.4%, to $41.06 a barrel and US West Texas Intermediate (WTI) crude was down $0.28, or 0.7%, at $38.87. Both contracts had jumped about 4% on Wednesday.
Biden predicted victory over President Donald Trump after winning two critical US states while the Republican incumbent alleged fraud, filed lawsuits and demanded recounts in a bitter contest.
Tamas Varga at oil brokerage PVM said, “A Trump win will likely be bullish for oil, at least more bullish than under a Biden administration. On the other hand, Joe Biden will rejoin (the Paris climate agreement).”
“Biden would also soften the US stance on Iran, consequently global oil supply could rise,” he said, adding that a drawn-out court battle over the results could cause additional uncertainty in the market.
Earlier on Wednesday, Oil prices surged on growing expectations that the Organisation of the Petroleum Exporting Countries (OPEC) and its allies would hold off on bringing back 2 million bpd of supply in January.
“The volatility in oil will remain because of its sensitivity to the US dollar. And the US dollar will remain volatile for at least the next few days as the US election still has to be worked out,” said Commonwealth Bank commodities analyst Vivek Dhar.