West Texas Intermediate closed at $88.12 a barrel, down 8.3%, after Vice President JD Vance posted that the war against Iran cost Republicans the midterms.
By the numbers: Brent crude, the international benchmark, shed 8.7% to settle at $94.62. Oil futures have fallen more than 14% this week after gaining more than 10% in October.
- "The reason we lost is the war," Vance said in a social media post Wednesday. "The president himself said so last night."
The backstory: The conflict has disrupted global energy supplies for eight months, and the market had priced in the risk of a major escalation once the elections were over.
What they're saying: "The elections are leading the market to conclude that Trump might now be inclined to make a deal," said Andy Lipow, president of Lipow Oil Associates, who expects Democrats to try to restrict funding for the war.
- Trump told the Financial Times on Tuesday that he has no immediate plans to strike Iran.
Yes, but: Bob McNally of Rapidan Energy warned the odds still favor military escalation, saying Iran is hardened in its uncompromising position and Trump is unlikely to walk away from a legacy goal he has already paid a huge price for.
- CIBC senior energy trader Rebecca Babin called the selloff possibly "a bit overdone," with the market in a shoot first, ask questions later mode.
Why it matters: Pump prices track crude with a lag, and gasoline has risen 38% since the war began, per AAA data cited by CBS News, so a sustained drop in oil is the fastest relief available to a household budget.
