WTI holds losses around $95.00 following US midterm elections

WTI oil prices declined to around $95.00 per barrel in European hours on Wednesday, following modest gains the previous day. This price drop was influenced by market caution ahead of the US midterm elections, where Democrats won control of Congress. The vote counting was ongoing, with Democrats securing majorities in both houses of Congress for the remainder of Donald Trump's second term.

Republican President Trump's conflicting signals, alongside ongoing military actions and diplomatic efforts, created uncertainty for traders, making it challenging to maintain a strong directional conviction. Analysts noted that profit-taking and reduction in speculative long positions were appropriate, particularly after the sharp rally in October.

The US conducted defensive strikes against Iran, targeting surface-to-air missile systems, but the limited scope of these strikes suggested no immediate return to large-scale military operations. WTI oil is a high-quality crude oil sold on international markets, sourced in the United States and distributed via the Cushing hub. The price of WTI oil is influenced by factors such as supply and demand, political instability, wars, sanctions, OPEC's decisions, the value of the US Dollar, and weekly Oil inventory reports.

OPEC's production quotas can impact WTI oil prices, with lower quotas tightening supply and higher quotas having the opposite effect. The US Dollar Index underperformed on Wednesday, dropping to its lowest level since late September, as early US midterm vote counts heightened political uncertainty and led to safe-haven flows.