Oil prices slide $2 on China demand worries, U.S. midterm elections

Shafaq News / Oil prices fell more than $2 on Tuesday in choppy trading on growing worries about fuel demand as COVID-19 outbreaks worsened in top crude importer China, and jitters about the outcome of U.S. midterm elections.

Brent futures for January delivery fell $2.56 to $95.36 a barrel, a 2.6% loss. U.S. crude fell $2.88, or 3.14%, to $88.91 per barrel.

"The market is entering today with a certain degree of skepticism surrounding the election... It's a wait to see what the result is type of a situation here," said Bob Yawger, director of energy futures at Mizuho in New York.

U.S. stocks also gyrated as market participants bided their time waiting to see whether Capitol Hill is in for a power shift, with Republican gains expected in the midterm elections.

On Monday, both benchmarks hit their highest since August on reports that leaders in China were weighing an exit from the country's strict COVID-19 restrictions.

But new cases have surged in Guangzhou and other Chinese cities, dimming prospects for fewer restrictions.

Gasoline and diesel supplies remain uncomfortably low, he added, limiting the downside for crude prices as most of the United States braces for major cold weather.

U.S. inventories of distillate fuels finished October at their lowest levels for any October since 1951, according to the U.S. Energy Information Administration.

(Reuters)