Oil market has not priced in prospect of a Biden victory | Financial Times

Oil market has not priced in prospect of a Biden victory | Financial Times:

Wall Street oil investors spend a fortune trying to figure out how to trade risks, from Opec meetings to Libyan militia movements or even pandemics.

But a doozy is staring them in the face — and oil markets, even after a brisk sell-off this week, have been largely a snoozefest, trading in a narrow range around $40 a barrel for months.

That risk for the oil industry is Joe Biden. President Donald Trump’s positive test for coronavirus has thrown up new uncertainty over the US election but if recent polling is right, Democrat Mr Biden will win the presidency on November 3. His party may even take the Senate, giving it full control of Congress.

Some crisis fatigue may be partly to blame for the oil market’s muted reaction to this prospect. After a Saudi-Russian supply war, the virus-induced collapse of global crude demand, sub-zero prices, dozens of corporate bankruptcies and mass job losses, traders want a breather. As coronavirus cases surge again in some western countries, they have other new threats to consider too.