Crude Prices Rebound Sharply Thursday, Easing After Midweek Rout

Oil prices surged Thursday, sharply recovering from the previous day's steep losses as the market reassessed the likelihood of a swift end to the Iran conflict following U.S. midterm elections. West Texas Intermediate crude settled at $91.07 per barrel, a gain of $2.95 (3.35%), according to live price data. Brent crude rose to $99.02, up $4.40 (4.65%).

The rebound follows Wednesday's dramatic selloff, where Brent plunged $8.98 to settle at $94.62 and WTI shed $7.97 to close at $88.12, according to OilPrice.com. The initial collapse was triggered by a Democratic sweep of both chambers of Congress in Tuesday's elections, which fueled speculation of increased pressure on President Donald Trump to end the eight-month war with Iran.

By Thursday, however, the prospects for a quick diplomatic resolution appeared less certain. Eurasia Group lowered its estimated probability of a negotiated agreement to just 10%, down from 20%, while putting the likelihood of renewed U.S. strikes at 60%, OilPrice.com reported. Persistent shipping risks in the Persian Gulf, with at least five vessel incidents reported since Sunday, also supported the price recovery.

For Bakken operators, the rebound provides relief after Wednesday's brutal drop pushed WTI to its lowest settlement since August 31. The Bakken differential, the discount at which Bakken crude trades relative to WTI at the Clearbrook, Minnesota hub, was recorded at $-3.42 per barrel Thursday. This means Bakken crude is priced at approximately $87.65 per barrel. While prices remain volatile, the recovery back above $90 WTI supports continued economic drilling and completion activity in the North Dakota play.

Market analysts cited by OilPrice.com noted Wednesday's collapse was amplified by heavy liquidation in crude futures, and Thursday's recovery may reflect traders reversing some of those positions as prices approached technically oversold territory. The physical market has seen Gulf crude exports recover toward pre-war levels, albeit with higher transportation costs, but the underlying geopolitical risk remains unresolved.

Natural gas prices saw a modest decline, with the benchmark settling at $2.92 per MMBtu, down $0.04. The focus for the Williston Basin, however, remains squarely on crude oil volatility driven by the unfolding political and military situation in the Middle East.