- Markets react to Democrats' win in midterms
- Investors watch talks to end Iran war
- Surprise drawdown in US crude stockpiles offers some support
- October Gulf oil flows slip, still almost three-quarters of pre-war levels
HOUSTON, Nov 4 (Reuters) - Oil prices tumbled more than $4 a barrel on Wednesday in volatile trading as investors awaited Washington's next move in the US-Israeli war with Iran after President Donald Trump's Republican Party lost control of Congress in midterm elections.
Brent futures were down $4.50, or 4.3%, to $99.07 a barrel at 11:19 a.m. ET (1619 GMT), while US West Texas Intermediate crude futures were down $4.13, or 4.3%, to $92.02.
Brent in the previous session settled at its lowest level in nearly four weeks as traders weighed talks to end wars in Ukraine and Iran.
"Larger crude oil exports out of the Middle East along with President Trump stating he has no immediate plans to strike Iran is keeping the pressure on crude oil prices for now. The Democratic control of Congress could also tighten US military spending in the Middle East and further heighten the possibility of a peace deal sooner than later," said Dennis Kissler, senior vice president of trading at US financial services firm BOK Financial.
Trump acknowledged that the Iran war had played a role in his party's sweeping defeat in the midterm elections, as Democrats won control of the House of Representatives and the Senate. Trump told the Financial Times on Tuesday that the United States had no immediate plans to strike Iran.
Iran's Supreme Leader Mojtaba Khamenei said in a written statement that US hostility would persist regardless of which party was in power. Meanwhile, Yemen's Houthis said they had targeted King Khalid International Airport in Riyadh. There was no confirmation from Saudi authorities.
Markets remained on watch for any progress in talks to end the war, as Qatar stepped up mediation efforts to avert an escalation of attacks after the US elections. A senior Iranian official told Reuters on Tuesday that Iran and the United States remain far from a deal to end their war.
"The elections are giving bears a reason to cast doubt on a continuation in Iran... I'm more concerned that we can see an escalation in Iran sooner than a resolution. President Trump may not say now, but we know that doesn't mean not soon," said Carl Larry, who leads the trading and North America Risk team at Enverus.
Gulf exports of crude, condensate and refined products, excluding LPG, averaged 17.1 million barrels per day in October, according to ship-tracking data from Vortexa, down from 18.9 million bpd in September but still roughly three-quarters of pre-war levels.
The United Arab Emirates is considering a third oil-export pipeline that will deliver crude outside the Strait of Hormuz, Bloomberg reported, citing people familiar with the matter, as the country aims to sharply reduce its dependence on the waterway.
In the US, crude stocks, gasoline and distillate inventories fell last week, the Energy Information Administration said on Wednesday.
Crude inventories fell by 865,000 barrels to 409.8 million barrels in the week ended October 30, the EIA said, compared with analysts' expectations in a Reuters poll for a 877,000-barrel rise.
US oil stocks fell by 5.27 million barrels in the week ended October 30, market sources said on Wednesday, citing data from the American Petroleum Institute.
Reporting by Jeslyn Lerh in Singapore; additional reporting by Sam Li and Lewis Jackson in Beijing; editing by Louise Heavens, Jason Neely and Nia Williams
Source: Reuters