il prices edged higher on Tuesday after trading either side of unchanged all morning, keeping crude in line with a small increase in U.S. stock markets as voters headed to the polls to elect the next president of the United States.
The most recent polls have put Democrat Hillary Clinton ahead of Republican rival Donald Trump in Tuesday’s election. Most investors believe a Clinton victory would result in greater certainty and stability in financial markets.
Brent futures rose 15 cents, or 0.3 percent, to $46.30 a barrel by 1:38 p.m. EST (1838 GMT). U.S. crude rose 34 cents, or 0.8 percent, to $45.23 per barrel.
Brent crude’s premium to the U.S. West Texas Intermediate (WTI) futures contract declined to its lowest in almost five months.
The Organization of the Petroleum Exporting Countries forecast demand for its oil will rise in the next three years, suggesting its 2014 decision to let prices fall to curb costlier rival supplies is delivering higher market share. [OPEC/M]
The group meets on Nov. 30 and has pledged to reach a deal on cutting output to try to reduce a two-year-old global surplus.
But several member states have asked to be exempt from any deal. Along with questions over the likelihood of non-OPEC rival Russia joining in, this has created doubt about OPEC’s ability to deliver a meaningful cut.
Mohammed Barkindo, secretary-general of OPEC, warned that failure to implement the agreement reached in Algiers in September to cut output would bring negative consequences to an already fragile oil industry.
“The fact that Barkindo feels a need to make such public statements suggests the membership remains divided on at least the details of an agreement,” Citi Futures energy futures specialist Tim Evans said in a note.
At 4:30 p.m. EST on Tuesday, the American Petroleum Institute (API) will release its data on U.S. oil inventories for the week ended Nov. 4. On Wednesday, the U.S. Energy Information Administration (EIA) will release its weekly petroleum status report at 10:30 a.m. EST.
Analysts said they expected crude stocks to rise 1.3 million barrels, according to a Reuters poll. [EIA/S]
On Tuesday, EIA projected U.S. crude oil production for 2016 and 2017 would fall by less than previously expected, according to its monthly short-term energy outlook.
In the United States, Colonial Pipeline’s plan to restore its original gasoline line to service after a leak in September does not yet have federal approval.
Source: Reuters (By Scott DiSavino; Additional reporting by Amanda Cooper in London and Henning Gloystein in Singapore; Editing by David Gregorio, Marguerita Choy and Dale Hudson)