Renewed U.S. military action against Iran could drive both major crude benchmarks above $100 a barrel, according to Rapidan Energy Group CEO Bob McNally. Speaking on CNBC's Squawk Box Asia, he estimated an 80% probability that fighting would resume in the coming days as the U.S. midterm elections move into the background.
Brent crude futures were trading around $100 a barrel and West Texas Intermediate around $91. Oil had already climbed above $100 before the elections amid uncertainty about the Iran conflict and the possibility of additional American attacks. President Donald Trump had said there would be no new strikes before the vote, although The Wall Street Journal reported, citing U.S. officials, that limited strikes had taken place.
McNally said Trump's determination to prevent Iran from obtaining a nuclear weapon and persuade it to surrender its nuclear capabilities remained at odds with Tehran's position. He argued that this unresolved disagreement continued to create conditions for escalation, with neither side overcoming the central obstacle to a deal.
Lombard Odier chief economist Samy Chaar and investment strategy head Luca Bindelli offered a similar assessment in a November 4 note. They said the period before the incoming Congress takes office could provide Trump with an opportunity to restart strikes. However, pressure on American munitions supplies could limit both the length and effectiveness of another campaign.
Other analysts see a greater chance of negotiations. Norbert Rücker, who heads economics and next generation research at Julius Baer, said markets had grown more confident that the conclusion of the midterms could open a diplomatic path. Reuters reported on November 6, citing a senior Iranian official, that Tehran had submitted a nuclear proposal to Washington through Qatar.
The official said discussions would depend on Washington meeting seven Iranian demands. These included ending what Tehran described as American aggression and economic warfare, lifting the naval blockade of Iranian ports and releasing Iranian assets. In exchange, Iran would permit ships to pass freely through the Strait of Hormuz. The official said the U.S. was reviewing the proposal but offered no further details.
The conflict also prompted a public dispute between Iranian parliamentary speaker Mohammad Bagher Ghalibaf and U.S. Vice President JD Vance. After Vance attributed Republican midterm losses to the war, Ghalibaf mocked him on X and accused the Trump administration of preparing another phase of fighting.
In a November 4 post, Vance said a pollster he had consulted found that ending the war was the leading concern among former Trump voters who switched to Democrats. Inflation and living costs also featured among their concerns, as the conflict has raised global energy costs. Vance has sometimes advocated diplomacy, and The Wall Street Journal reported last week that he contacted an Iranian hard-liner to try to restart peace talks.
