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Oil prices fell for a fourth day on Thursday on expectations the losses US President Donald Trump\u2019s Republican Party suffered in Congressional elections this week may reduce the risk \u200bof further escalation of the US-Israeli war on Iran.<\/strong><\/p>\n Brent futures fell 97 cents, or 1.03% \u200cat $93.65 a barrel as of 0211 GMT, while US West Texas Intermediate crude futures were down $1.14, or 1.29%, to $86.98.<\/p>\n A weakened Trump, facing \u200ba Democratic Congress able to constrain his military options, has greater incentive to seek a deal, \u200btwo sources close to Gulf government circles said on Wednesday. A full-scale assault on \u2060Iran now looks less likely, they said.<\/p>\n A resolution to the conflict could restore oil flows from the \u200bMiddle East impacted by the war, though analysts caution the way forward remains uncertain.<\/p>\n \u201cMarkets are assessing the impact \u200bof the midterm elections to Donald Trump\u2019s next steps with the Iran war, pricing in more likelihood for the war to end,\u201d said June Goh, senior oil analyst at Sparta Commodities.<\/p>\n \u201cHowever, there will be more volatility ahead as the path \u200bto full diplomacy to end the war is still wrought with many unknowns while the global strategic \u200breserves have drawn very thin.\u201d<\/p>\n Crude shipments through the Strait of Hormuz \u2014 the key waterway for most Gulf oil supplies \u2014 have \u200crecovered \u2060to close to pre-war levels, according to analysts, though at a higher cost.<\/p>\n The resumption of Gulf supply has pushed the global oil market back into surplus after months of disruption caused by the war, JPMorgan said in a note on Wednesday.<\/p>\n JPMorgan estimates the market returned to a surplus of 1.1 million barrels per day \u200bin September, widening to \u200b1.4 million bpd in \u2060October, nearly matching last year\u2019s average of 1.3 million bpd.<\/p>\n Still, the sharp selloff in oil may prove short-lived.<\/p>\n \u201cThe short answer is no,\u201d said Mukesh Sahdev, CEO \u200bof energy consultancy XAnalysts, when asked whether prices were likely to remain lower \u200bafter the election.<\/p>\n Sahdev \u2060said geopolitical risks remained difficult to predict and noted the incoming Congress would not take office until January, meaning US policy options had not immediately changed.<\/p>\n He also noted commercial oil inventories in major consuming countries are \u2060near their \u200blowest in 15 years and said Iran could emerge from \u200bthe US election outcome with greater resolve.<\/p>\n US crude, gasoline and distillate inventories all fell last week as demand hit its highest in \u200ba year, the Energy Information Administration said on Wednesday.<\/p>\n<\/div>\n