Oil steady after Trump falsely claims victory in tight US election

LONDON: Oil was largely steady on Wednesday after President Donald Trump falsely claimed victory in a tight U.S. election, despite millions of votes still to be counted and the final result not yet clear.

West Texas Intermediate was up 16 cents, or 0.4%, at $37.82 a barrel by 0850 GMT.

Brent crude was up by 24 cents, or 0.6%, at $39.95, after trading between $39.85 and $40.80.

I will be making a statement tonight. A big WIN!

— Donald J. Trump (@realDonaldTrump) November 4, 2020

Trump falsely claimed to have won after his Democratic challenger, Joe Biden, said he was confident of winning a contest that will not be resolved until a handful of states finish vote counts in the next hours or days.

“Take a sprinkling of coronavirus jitters, a dash of renewed lockdowns, a dusting of post-US election unease, a helping of OPEC+ uncertainty, then mix together. The result is one hell of a murky dish,” said Stephen Brennock at oil broker PVM.

Equity markets swung around, while bonds were trading higher as vote counting progressed and showed the election was closer than polls had forecast, with the outcome possibly still in doubt for days.

Prices has found support earlier from a sharp fall in U.S. crude oil stockpiles last week while gasoline inventories rose, data from industry group the American Petroleum Institute (API) showed on Tuesday.

Crude stockpiles fell by 8 million barrels to about 487 million, the API said. That contrasted with analysts’ expectations in a Reuters poll for an increase of 890,000 barrels.

More lockdowns could put a cap on oil price gains as Italy, Norway and Hungary tightened coronavirus curbs, following Britain, France and other countries.

Also supporting prices was Algeria’s support for the deferral of a planned increase in OPEC+ oil output from January as well as Russia’s energy minister raising this prospect with the country’s oil producers.

The Organization of the Petroleum Exporting Countries (OPEC)and allies led by Russia, a grouping known as OPEC+, are set to reduce cuts of 7.7 million barrels per day (bpd) by around 2million bpd from January.

Sources said OPEC and Russia were considering bigger production cuts next year to support prices.