Oil prices rebounded on Thursday, with Brent crude climbing 4.0% to $98.38 per barrel and WTI rising 2.9% to $90.65. The uptick came a day after Democrats secured control of both the House and Senate, raising concerns about potential legislative hurdles for the Trump administration. U.S. natural gas prices held steady at $2.95/MMBtu, while European gas prices gained 1.9% to €89.72/MWh.
The energy sector saw mixed performance, with the State Street Energy Select Sector SPDR ETF (XLE) dropping 1.6% to $62.50 despite the oil price recovery. Investors had initially bet on a peace deal with Iran following the election results, but those expectations faded as Eurasia Group reduced the odds of a negotiated agreement to 10% and increased the likelihood of renewed U.S. strikes to 60%. Iran reported a tanker fire near the Strait of Hormuz, adding to market uncertainty.
In other developments, two Russian tankers carrying diesel to the U.S. under the Trump-Putin deal abruptly changed course, one heading to Brazil and the other to the Mediterranean. Analyst Matt Smith from Kpler noted the hesitation in bringing these barrels onshore due to potential implications. Meanwhile, the Middle East physical oil market shifted into a surplus for the first time since July, with crude exports from Gulf producers surging 10% to 15.53 million barrels per day in October.
Renewable energy stocks gave up earlier gains, with the iShares Global Clean Energy ETF (ICLN) falling 2.4% to $16.20. Enphase Energy (NASDAQ:ENPH) tumbled 8.5% to $28.86, while First Solar (NASDAQ:FSLR) gained 1.6% to $197.56. Sunrun (NASDAQ:RUN) stood out with a 13.3% climb to $9.96 after reporting strong third-quarter results, including revenue of $1.10 billion and net income of $153.2 million.