Crude Oil Prices Fall Below $104 Amid US-Iran Peace Talks, Midterm Elections

Crude oil prices fell on Wednesday as investors monitored the US midterm elections and diplomatic efforts to end the conflict involving Washington, Israel and Iran.

Brent crude futures declined 0.34% to $103.3 per barrel, while US West Texas Intermediate (WTI) futures slipped 0.5% to $95.6 per barrel.

The decline extended losses from Tuesday, when Brent dropped more than 1% to its lowest level in nearly four weeks.

Traders weighed the possibility of improved oil supplies against the risk of further disruptions in the Middle East.

Vote counting continued in the US midterm elections, which will determine whether President Donald Trump's Republican Party retains control of Congress during the remainder of his second term.

Investors were assessing how the results could influence Washington's foreign policy and its approach to the Middle East conflict.

Qatar has intensified mediation efforts to prevent further escalation following the elections.

However, a senior Iranian official told Reuters on Tuesday that Tehran and Washington remained far from reaching an agreement.

Meanwhile, US forces conducted what officials described as defensive strikes against surface-to-air missile installations on Iran's Qeshm island.

A US official said the limited operation did not suggest a resumption of major combat.

Trump also told the Financial Times that Washington had no immediate plans for additional strikes against Iran.

Any diplomatic breakthrough could ease concerns about regional oil supplies, potentially putting further pressure on crude prices.

Renewed hostilities, however, could increase supply risks and support prices.

Providing some support to oil markets, US crude inventories fell more sharply than analysts had expected during the week ended Oct 30.

The figures came from the American Petroleum Institute (API), according to market sources cited on Wednesday.

The inventory decline suggested tighter US crude availability, partially offsetting downward pressure from expectations of reduced geopolitical tensions.

Oil traders continued to assess diplomatic developments, election-related uncertainty and supply indicators for their potential impact on prices.