By Barani Krishnan
Investing.com - Oil prices fell on the day and rebounded on the week, exhibiting volatility unsurprising for the world’s most politically-sensitive commodity as Democrat Joe Biden appeared likely to take control of the White House amid vows by President Donald Trump to legally challenge the outcome.
New York-traded West Texas Intermediate, the leading indicator for U.S. crude, settled down $1.65, or 4.2%, at $37.14 per barrel. For the week, however, WTI jumped 3.8% rebounding strongly from a mid-June low of under $33.64 hit earlier in the week before it slid again on demand concerns.
London-traded Brent, the global benchmark for crude, fell $1.48, or 3.6% to settle at $39.45 per barrel. Brent rose 5.3% on the week.
Biden is heading for the minimum 270 needed to take the White House, CNN and Fox News reported.
Also weighing on oil prices Friday was realization that an eventual Biden administration could move America toward tighter Covid-19 related measures versus Trump’s relaxed approach. That aside, over the longer term, he could roll back sanctions imposed by his predecessor against one-time major crude exporter Iran.
A Tehran freed from sanctions could easily add between one million and two million barrels of oil per day to global production, seriously impacting oil prices in a market that continues to suffer from low demand forced by the Covid-19 pandemic.
“While the presidential race still has not been decided, the risk of the market’s attitude is apparent,” said Phil Flynn, analyst at Price Group Futures in Chicago.”
“The main reason is still the coronavirus plague that raises a concern for more oil and gas demand destruction. Also, job losses in the energy space have been racking up.”
More than 9.6 million Americans have been infected by Covid-19, and over 233,000 have died from complications related to the virus.
The United States gained 638,000 jobs in October, more than forecast by economists but less than September’s growth, the government’s monthly jobs data showed Friday.
The economy lost more than 21 million jobs for all of March and April, at the height of lockdowns forced by the COVID-19. It posted a strong rebound of 2.5 million jobs in May and 4.8 million in June. Job gains have slowed since, with 1.8 million in July, some 1.5 million in August and 672,000 in September.