Oil settles steady, posts steepest weekly loss since 2020

The US midterm election results raised hopes of a potential de-escalation in the war with Iran, which could boost oil exports from the Middle East.

Brent crude futures settled little changed on Friday but recorded their steepest weekly loss since the COVID-19 pandemic in 2020, weighed by hopes that the US-Iran war could end following the midterm election defeat of the Republican Party, to which President Donald Trump belongs.

The US midterm election results raised hopes of a potential de-escalation in the war with Iran, which could allow oil exports from the Middle East to increase.

Janiv Shah, an oil market analyst at Rystad Energy, said the crude market was heading toward a supply surplus based on supply-and-demand dynamics, despite continued quality-related price differentials between crude grades.

Shipping risks in the Middle East remain, despite the prospect of de-escalation. Data from the UK Maritime Trade Operations (UKMTO) indicate that attacks on vessels in the Strait of Hormuz remain close to record levels.

Matt Stanley of Kpler, which tracks oil tankers and energy flows, said falling prices did not mean that the market's underlying problems had disappeared, describing this week as one of the most extraordinary periods he had witnessed in more than 25 years in the industry.