Oil prices ease to settle near 4-week low on hopes peace talks will end wars

[NEW YORK] Oil prices eased about 1 per cent on Tuesday (Nov 3) to the lowest in nearly four weeks, as the market weighed talks to end the wars in Ukraine and Iran against worries that recent attacks in both conflicts could further disrupt supplies.

The world is also watching US midterm elections to see whether President Donald Trump’s Republican Party can retain control of the US Congress for the rest of his second term. Opinion polls and nonpartisan analysts expect Democrats to wrest the House of Representatives, while the Senate remains uncertain.

Brent futures fell US$1.17, or 1 per cent, to settle at US$103.60 a barrel, their lowest close since Oct 7. US West Texas Intermediate crude fell 37 cents to settle at US$96.09, its lowest since Oct 14.

Iran and the US are still far from a deal to end their war, a senior Iranian official told Reuters, while mediator Qatar stepped up efforts to avert an escalation after the US midterm elections.

Qatar’s Foreign Ministry spokesperson said the US and Iran remain committed to mediation efforts and are reviewing proposals aimed at bridging their differences.

“Despite these positive signals, it’s probably too early to think escalation risks have passed,” ING said in a note. “What is clear, though, is that strong signals of progress in peace talks would mean more downside for prices.”

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Overnight, the US carried out strikes on Iran’s Qeshm Island. A US official said the strikes targeted surface-to-air missiles used against US assets. Another official said the strikes appeared limited and did not signal a return to major combat operations.

Separately, Trump said he made a deal with Israeli Prime Minister Benjamin Netanyahu that Washington would stop US$4 billion in funding to Israel after the end of this year.

Saudi state oil company Aramco is working to expand a crude pipeline that circumvents the Strait of Hormuz, CEO Amin Nasser said.

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The effective blockade of the chokepoint that links the Gulf to world markets, previously a conduit for 20 per cent of global oil supplies, has redrawn energy flows and infrastructure investment priorities among the region’s oil producers.

Russia and Ukraine

Russia will hold three-way peace talks with Ukraine and the US in Abu Dhabi from Nov 10 to 11, the Kremlin confirmed.

Russia was the world’s third-biggest crude oil producer behind the US and Saudi Arabia in 2025, US energy data showed. Sanctions designed to keep Russian energy out of global markets after Moscow’s invasion of Ukraine have helped support oil prices.

Any deal to end Russia’s invasion of Ukraine, which Moscow launched in 2022, could allow Russia to export more.

Ahead of the upcoming talks, however, Russia bombarded Ukraine’s energy infrastructure, knocking out power to swathes of the country with dozens of missiles and hundreds of drones.

Ukraine set fire to a major oil refinery in the Russian city of Yaroslavl in an overnight drone attack, the regional governor said.

Recent attacks on cargo ships near Nato members Romania and Bulgaria show how the escalating maritime war between Russia and Ukraine is expanding into a major challenge for Nato in the Black Sea.

Elsewhere, Venezuela’s oil exports were little changed at 1.08 million barrels per day in October as stagnant crude production and high freight rates continued to curb demand for many South American grades, according to shipping data seen by Reuters.

US oil stockpiles

The oil market awaits weekly storage reports from the American Petroleum Institute trade group on Tuesday and the US Energy Information Administration on Wednesday.

Analysts estimate energy firms added 0.9 million barrels of crude to US storage during the week ended October 30.

If correct, it would mark the first time crude stocks have increased in five weeks. There was an increase of 5.2 million barrels in the same week last year. REUTERS