Oil Drops 12% on the Week as Midterm Results Fuel Hopes for an End to the Iran War

Oil benchmarks are heading for one of their sharpest weekly drops of the year, with Brent crude and West Texas Intermediate both down roughly 12% since Monday, as results from this week’s U.S. midterm elections fed trader hopes that Washington could move toward winding down the war between the United States, Israel and Iran. The slide has not gone one way, though: fresh reports of tanker incidents in the Persian Gulf have repeatedly interrupted the decline, and both benchmarks ticked back up from Thursday’s close once the latest reports emerged.

As of early Friday, Brent was trading near $99.42 a barrel and WTI near $91.24, according to data cited by Oilprice.com. Both marks are well off the multi-month highs set in late October, when a wave of attacks on shipping in the Strait of Hormuz had pushed Brent to its strongest level in six months.

A sharp reversal from October’s rally

The move is a reversal of the pattern that has dominated oil markets since the war began in February. Through most of October, each new report of a tanker fire or mine strike near Hormuz added a risk premium to prices, and Brent notched four straight monthly gains on the back of it, as The Daily Energy has reported. This week broke that pattern: instead of extending the rally, crude fell hard in the first three sessions, erasing essentially all of October’s gains before steadying.

Traders and analysts have treated the shift as a sign that the market’s attention moved from the immediate disruption risk to the political outlook for the conflict itself. Reuters reported that Tuesday’s midterm results were read on trading floors as raising the odds of a faster push toward ending the war, which is now in its ninth month.

Midterms change the political calculus, but not the facts on the water

The price action illustrates how oil markets have been pricing politics as much as physical supply in recent months. Persian Gulf crude and LNG flows have continued largely uninterrupted even as the war has escalated on paper, so the premium built into prices has been driven mostly by the perceived probability of a wider disruption to the Strait of Hormuz, the narrow waterway between Iran and Oman through which roughly a fifth of the world’s seaborne oil passes, according to the U.S. Energy Information Administration.

That is why the midterm results moved prices even though nothing changed in the Gulf itself on election day: a shift in Washington’s domestic political position changes traders’ estimate of how long the war, and the attacks tied to it, might continue.

The Gulf risk premium has not disappeared

The rebound from Thursday’s close shows the premium is still there. Reuters reported at least five separate vessel incidents in the Persian Gulf since Sunday, following a string of tanker fires that Iran’s navy and Revolutionary Guard have attributed to mines and projectiles in waters near Hormuz and Oman in recent weeks — claims that outside shipping-security monitors have only partly been able to corroborate. The Daily Energy reported on Tuesday that Iran said four tankers had been hit by mines near the strait, part of a pattern of incidents that has run through late October and into November without an independent tally of casualties or vessels affected.

Analysts at ING, cited by Oilprice.com, said they expect prices to keep easing if the war does not escalate further, since Gulf oil flows have held up despite the attacks. They cautioned, however, that any escalation — a strike that closes a shipping lane, for instance, rather than targeting an individual vessel — would be likely to push prices back up quickly.

What comes next for the market

For now, the market is treating the midterm result as a reason to trim the war premium rather than eliminate it. Options pricing and the persistence of the Thursday rebound both suggest traders are not willing to fully discount the risk of another Hormuz-area incident disrupting tanker traffic, even as they lower their odds of a wider war. Whether this week’s decline holds into next week will likely depend on two things that have driven the market since February: whether Washington signals a concrete step toward negotiations with Tehran, and whether the string of vessel incidents in the Gulf continues, accelerates or finally draws a verified, independent account of what is causing them.

Sources: Oilprice.com, “Oil Prices Head for 12% Weekly Loss Despite Fresh Tanker Attacks,” Nov. 6, 2026 (price levels, weekly move, Reuters-sourced vessel-incident count, ING commentary); Reuters, cited via Oilprice.com, on midterm-result market reaction and Gulf vessel incidents; The Daily Energy, “Brent Settles at a Six-Month High as Hormuz Tanker Attack Caps Fourth Monthly Gain,” Oct. 31, 2026; The Daily Energy, “Iran Says Four Tankers Hit by Mines Near Strait of Hormuz,” Nov. 4, 2026; U.S. Energy Information Administration, World Oil Transit Chokepoints (Strait of Hormuz volume share).

Illustrative image. Photo: NASA Johnson Space Center, Public domain, via Wikimedia Commons — source