Brent Falls to $109.6 as Netanyahu Bloc Wins 53 Seats, Short of Majority
Key Facts
Brent crude settled at $109.6 a barrel on Oct. 29, compared with $115.32 in the previous session, while West Texas Intermediate finished at $100.48, against $102.78 on Oct. 28, according to EL7 daily data. The decline came as attention turned to Israel’s election results, after Benjamin Netanyahu’s bloc failed to reach a parliamentary majority despite leading in the seat count. Available results on Oct. 29 showed Netanyahu’s bloc winning 53 seats, compared with 48 for the opposition bloc. The initial results therefore did not deliver a scenario in which the bloc won enough seats to determine the formation of a government. Traders were also watching war risks and the prospects for talks, both factors in oil’s moves during the week.
Both crude benchmarks gained in the previous session before reversing course on Oct. 29. Brent rose 1.3% to settle above $115 a barrel on Oct. 28, while WTI closed near $103, according to a Bloomberg report published by Rigzone. The next day, Brent fell 1.34% to $113.77 a barrel, and U.S. crude dropped 1.95% to $100.78 at 1314 GMT, according to Reuters via Marketscreener. The report attributed the decline at the time to hopes for talks outweighing supply concerns. These prices reported during the sessions differ from EL7’s daily closing prices recorded at the end of the day; EL7 data put both closes at lower levels. The figures show the market shifting from Wednesday’s gains to Thursday’s losses, while the course of the war and negotiations remained part of the trading backdrop.
Politically, projections by Israeli media as the vote count neared completion showed Netanyahu’s bloc with 53 seats, compared with 48 for Gadi Eisenkot’s bloc and 19 for Arab parties, according to the Associated Press. An update from the Election Committee, reported by Israeli media on Oct. 29 after the count of double-envelope ballots was nearly complete, kept the seat distribution at 53 for Netanyahu’s bloc and 48 for the bloc opposed to him, according to The Times of Israel. The bloc needs 61 seats for a parliamentary majority, the Associated Press reported, so its lead was not enough to secure one. Netanyahu’s bloc had held 68 seats in the previous parliament, according to the same agency, underscoring the scale of its decline from its previous peak representation. President Isaac Herzog is due to meet representatives of all Knesset blocs after receiving the official results. He said: "Upon receiving the official results, I will meet representatives of all Knesset factions."
The election carries political significance beyond the distribution of seats. The Associated Press described the vote as the first since Hamas’s Oct. 7, 2023, attack and as a referendum on Netanyahu’s rule, which has spanned nearly 17 years. The agency said the vote marks a pivotal moment in Israel’s history, as voters assess the course of government during that period. But available results did not give Netanyahu’s bloc a majority, while the opposition remained close behind after accounting for votes still being counted. That puts the coming consultations on forming a government at the center of the political scene after the official results are announced. Herzog said he had urged bloc leaders to consider the country’s interests ahead of consultations scheduled for the following week, according to a statement from the Israeli presidency.
Supply risks remained in the market’s background. A UBS analyst said global inventories had fallen sharply and announced releases from strategic reserves were nearing completion. He added that record shipping costs, tight tanker capacity and a recovery in Chinese imports could keep prices elevated. In the United States, Energy Information Administration data showed crude inventories fell by 1.9 million barrels in the week ended before Oct. 28, the fourth consecutive weekly decline, according to a Bloomberg report. Traders were tracking the possibility of renewed military action against Iran, according to an FXEmpire brief. In contrast, an Iranian official said Qatari mediators had delivered a new draft agreement to Tehran to end the war with the United States and Israel, while a senior Iranian official described the ideas as unacceptable and falling short of an offer, according to Reuters. These developments put escalation and negotiations side by side in the market’s calculations, without the Israeli election result settling either path.