Oil held a two-day drop as traders tracked a tight Israeli election that will help to shape the course of the US war with Iran.
West Texas Intermediate steadied near US$100 a barrel after falling more than 3% over two sessions. Brent closed below US$114.
Opposition leader Gadi Eisenkot edged slightly ahead of Prime Minister Benjamin Netanyahu in the contest, setting up a tense period of talks over who will form the next government.
The high-stakes vote comes against a backdrop of renewed diplomacy in the Middle East, with officials from Saudi Arabia, Pakistan and Turkey travelling to Tehran for discussions on Monday.
Still, Supreme Leader Mojtaba Khamenei has reiterated his country’s existing conditions for ending the war.
Global crude benchmark Brent has surged more than 85% in 2026 as the conflict – which began in February when Netanyahu joined with US President Donald Trump to attack Tehran – roiled energy flows.
Following the Israeli election, US voters will go to the polls next week for midterm elections, potentially revealing a slump in support for the Trump administration.
Eisenkot pitched himself as a more modest alternative to Netanyahu, while still emphasising a commitment to resolving Israel’s security challenges.
On Iran, he has said the country’s nuclear programme must be curbed, militarily if necessary, but that regime change in Tehran is “not an achievable goal”.
Still, with the make-up of a new government likely to take days or weeks to finalise, Netanyahu remains Israel’s prime minister. That would enable him to join Trump in a renewed bombing campaign of Iran after the midterms.
On the campaign trail in the US, Trump urged patience over high energy prices, fuelled in part by the war.
“Short-term pain, right, for long-term gain. You’re going to see very soon,” he told a rally in Corpus Christi, Texas.
There is “a very real possibility President Trump loses his willing war-in-Iran partner, Benjamin Netanyahu,” said Robert Yawger, director of the energy futures division at Mizuho Securities USA.
“The vote in Israel could be seen as a preview of what to expect in the US midterm elections in just one week.”
In the Middle East, risks remain elevated as Saudi energy infrastructure has faced repeated attacks by Yemen’s Iran-backed Houthi rebels.
The latest incident sparked a fire near the kingdom’s biggest oil export terminal at Ras Tanura early on Oct 27. While it was contained, according to a person familiar with the matter, the extent of any damage was not immediately clear.
Meanwhile, Iran’s Persian Gulf Strait Authority threatened to take legal action against vessels owned by Sinokor, citing repeated so-called violations over the past three months. The world’s biggest oil tanker owner has carried millions of barrels out of Strait of Hormuz in recent weeks.
On the physical front, the industry-funded American Petroleum Institute reported US crude stockpiles fell by two million barrels last week, according to a document seen by Bloomberg. Official data are due later on Wednesday.
Traders are also set to track the Federal Reserve’s interest rate decision in the session. Policymakers are expected to keep borrowing costs steady. BLOOMBERG
