Oil rises after Trump falsely claims victory in tight US election

[LONDON] Oil prices rose nearly 3 per cent on Wednesday after President Donald Trump falsely claimed victory in a tight US election with millions of votes still to be counted and the final result not yet clear.

A victory by Mr Trump is viewed as bullish for oil because of sanctions on Iran and his support for Saudi-led Opec oil cuts to support prices. A victory by his rival Joe Biden would be seen as bearish because of his green policies and softer stance on Iran.

West Texas Intermediate was up US$1.03 cents, or 2.66 per cent, at US$38.69 a barrel by 0955 GMT.

Brent crude was up by 1.09 cents, or 2.67 per cent, at US$40.80.

Mr Trump falsely claimed to have won after his Democratic challenger 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.

"This (potential Trump victory) is bullish for oil as Opec+ can keep cutting without fear that Iranian oil supply will come back into the market any time soon," said Bjarne Schieldrop at SEB.

Equity markets veered and bonds traded higher as vote counting showed the election was closer than polls had forecast.

Prices also drew support as Opec producers and Russia considered deferring a planned increase in Opec+ oil output from January as a second coronavirus wave stifles a recovery in fuel demand.

REUTERS