Energy markets

The Iran war produced a severe oil-supply disruption. With the Strait of Hormuz closed to most traffic and Gulf producers pumping below quota, oil prices have stayed 60–70% above their pre-war level (CBS News). Brent settled at $103.60 a barrel on 3 November, its lowest close since 7 October (Reuters). It fell to around $102–103 on 4 November as the market bet the result would push Trump toward a settlement (AP; Reuters). US regular gasoline averaged $4.15 a gallon and diesel $6.29 on election day, according to AAA. IEA members agreed in March to release 400 million barrels from emergency stocks, and about 96 million barrels remained to be released in mid-October (Argus). European gas prices are about 140% above February levels.

Congress's levers over energy markets are indirect. It can investigate oil-company profits and the fuel-price effects of the war; it can use the Congressional Review Act against recent vehicle and emissions rules; and it can fund or restrict the Strategic Petroleum Reserve. It cannot reopen Hormuz, set OPEC+ quotas or end the war. The 2025 reconciliation law's phase-out of wind and solar credits stands unless a new statute changes it.

The decisive variables are the Iran talks and OPEC+. Seven core OPEC+ members kept December output targets unchanged, having completed the rollback of a 1.65 million barrel-a-day cut in September, and must complete a production-capacity review in the fourth quarter before setting 2027 baselines (Reuters). Saudi Aramco is expanding pipelines that bypass the strait. A deal that lifts the US blockade and stops attacks on shipping would release Gulf barrels and Iranian exports together and push prices sharply lower; a resumption of strikes would do the reverse. Rapidan Energy Group's Bob McNally said the election itself should not have a big effect on prices, which will follow diplomacy and escalation (The Straits Times). The market's first reaction leaned the other way: oil fell for a third day on 4 November, and Saxo Bank's Ole Hansen said the market "increasingly appears to be betting that President Trump wants to put the Middle East war behind him," while tight inventories limited the decline (Reuters).

Europe and Asia carry the larger price exposure. Gas-importing economies have absorbed the Hormuz closure through LNG prices, with European gas about 140% above February levels, and the EU's push to diversify away from Russian energy now competes with US pressure to ease Russian sanctions (EUISS). Any Ukraine settlement that lets Russian diesel and crude move more freely would ease distillate prices in particular, which links energy markets to the Abu Dhabi talks as well as to Tehran.

Clean-energy equities rose on 4 November, with First Solar up 7%, Sunrun 6.1% and Ørsted 6.4%, on expectations that a Democratic Congress will resist further rollbacks and scrutinize offshore wind stop-work orders (Reuters). The more immediate effect is political: fuel and electricity prices helped decide the election, and both parties now have reason to prioritize them, which ties energy markets to data-center siting and Iran diplomacy.