By Jenny W. Hsu
Oil prices moved in a narrow range in early Asia trade Tuesday as investors adopted a wait-and-see approach before U.S. voters head to the polls to elect a new president.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in December traded at $44.78 a barrel at 0253 GMT, down $0.11 in the Globex electronic session. January Brent crude on London's ICE Futures exchange rose $0.02 to $46.17 a barrel.
Results of the U.S. presidential contest between Hillary Clinton and Donald Trump are expected to be begin coming in midmorning Wednesday Asia time.
"The market has largely priced in a Clinton victory so if she wins, we would see marginal effects on oil prices," said Vyanne Lai, an analyst at National Australia Bank, adding most market participants are banking on Mrs. Clinton to embrace an open-trade policy that could help improve the global flow of oil and gas trades.
However, if Mr. Trump pulls a surprise upset, global markets, including equities and commodities, could see sharp gyration, she added.
Oil investors are also keeping a close eye on progress of a production-cut deal among members of the Organization of the Petroleum Exporting Countries and its nonmember counterparts, such as Russia.
The deal could potentially help eliminate 200,000 to 700,000 barrels a day from OPEC producers, which would help accelerate the rebalance in the market.
It remains to be seen if Russia, the world's biggest energy producer, would join the accord. Some media are reporting that OPEC Secretary-General Mohammed Barkindo said Russia will be "on board" and is expected to throw its weight behind the deal to be ratified at the Nov. 30 meeting in Vienna. Russia, however, hasn't released any official statement.
"Our expectation is that the difficulty in reaching a specific deal means that compromises will be needed to achieve even a nominal agreement, reducing the likely impact of the result," said Tim Evans, a Citi Futures energy analyst.
One of the possible major hurdles hampering an agreement is the longstanding tension between Saudi Arabia and Iran. Iran has argued that it deserves to be exempt from any production-curb deal because it was subject to sanctions until January. The country has said any curtailment of its production before it is able to catch up to its presanction level would put it at an unfair disadvantage.
"The Middle East mistrust between Saudi and Iran threatens to sink any agreement after the Saudis allegedly told Iran, 'sign or we turn the taps up higher,'" said Stuart Ive, a client manager at OM Financial.
Oil investors will also be watching the weekly U.S. oil inventories and production data for week ended Nov.4. In the previous week, U.S. inventories rose to a three-decade high of more than 14 million barrels, largely due to imports. The official data will be out on Wednesday.
China's October crude imports rose 9.3% on-year to 28.79 million barrels, the second lowest volume of the year as many refiners underwent maintenance last month. China is one of the world's biggest energy consumers and often rivals the U.S. as the top energy importer.
Nymex reformulated gasoline blendstock for December--the benchmark gasoline contract--fell 47 points to $1.3663 a gallon, while December diesel traded at $1.4414, 8 points higher.
ICE gasoil for December changed hands at $421.50 a metric ton, up $3.75 from Monday's settlement.
Write to Jenny W. Hsu at firstname.lastname@example.org
(END) Dow Jones Newswires
November 07, 2016 22:36 ET (03:36 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.