Oil Falls for Second Day as Traders Watch Israeli Election, WTI Near $100

Oil fell for a second straight day as traders watched the outcome of Israel's general election and diplomatic moves across the Middle East.

Bloomberg reported on October 27 that US West Texas Intermediate traded near $100 a barrel. WTI has dropped more than 3% over the past two trading days, while Brent, the global benchmark, settled below $114 a barrel.

Markets are focused on whether the Israeli election result could affect the direction of the war involving the US and Iran. Exit polls showed opposition leader Gadi Eisenkot narrowly ahead of Prime Minister Benjamin Netanyahu, though neither side appeared to have secured a parliamentary majority. Vote counting is continuing.

Diplomatic efforts in the Middle East are also continuing. Officials from Saudi Arabia, Pakistan and Turkey visited Tehran on October 26 for talks. Still, Iran Supreme Leader Mojtaba Khamenei reaffirmed existing conditions for ending the war.

Oil prices have surged since the US and Israel attacked Iran in February. Disruptions to Middle East energy supplies caused by the war have pushed Brent up more than 85% so far this year.

A decline in US crude inventories is also drawing attention. The American Petroleum Institute estimated that US crude stockpiles fell by about 2 million barrels last week. Official inventory data is due on October 28.

Markets view changes in Middle East tensions after the Israeli election, along with US crude inventory data, as key factors in determining the next direction of oil prices.