Oil prices plunge after Vance blames Iran war for GOP rout

Crude oil prices fell sharply on Wednesday, November 4, after Vice President JD Vance said the war with Iran cost Republicans the midterm elections. Traders bet that Democratic control of Congress will push President Donald Trump toward a deal with Tehran rather than a wider conflict. U.S. West Texas Intermediate dropped below $90 a barrel in midday trading, down about 7% to 9%, and Brent crude fell more than 8%, according to CNBC Comcast Corporation ↘ 1.12% and the Financial Times. Brent went under $100 for the first time since October 7, NBC Boston reported.cnbc.com+2

Vance's post

"The reason we lost is the war," Vance wrote in a long post on X. "The president himself said so last night." NBC News reported the post. Vance argued that turnout was not the main problem. In his view, the bigger issue was that "many people who voted for Trump/Vance in 2024 voted for Democrats in 2026". "If you'd like to argue it was worth it, that losing the Senate for the next 6 years was worth it, then do so," he wrote.nbcnews.com+2

Trump partly agreed with him. "I think it's largely true because it drove the gasoline up a little bit short term," the president said on Wednesday, but he added that "if I had it to do again, I'd have to do it again". On Tuesday night, Trump told The Wall Street Journal News Corp ↗ 0.76% and The New York Times ↗ 0.95% that the war was partly to blame for the losses.edition.cnn.com+1

Markets reprice escalation risk

Traders had priced in the risk of a major escalation after the vote, and that fear helped push oil up more than 10% in October. Oil futures have now fallen more than 14% this week as senior U.S. and Iranian officials signaled they are open to a diplomatic settlement. Trump told the Financial Times on Tuesday that he had no immediate plans to strike Iran.cnbc.com

Rebecca Babin, a senior energy trader at CIBC Canadian Imperial Bank of Commerce ↘ 0.80%, said the market was in a "shoot first, ask questions later" mode. She noted that "Vance's commentary and the public lack of backing from key allies have challenged" the view that a Democratic sweep would push Trump to escalate. Claudio Galimberti, chief economist at Rystad Energy, said Democrats controlling both chambers means "greater institutional pressure to find a Hormuz deal".ft.com+1

Stocks also gained. The Dow Jones Industrial Average was on track for its biggest post-midterm rally since 1982, helped by the drop in oil and lower bond yields.edition.cnn.com

Pressure persists

The risk of conflict has not gone away. On Wednesday, the administration announced new sanctions on Iran while the prospect of renewed military operations remains. The war, which the U.S. and Israel launched in late February, has disrupted global energy supplies for eight months. GasBuddy analyst Patrick De Haan said the national average gas price could fall below $4 in the "days ahead".nbcboston.com+2