TD Securities: Iran Unlikely to Compromise Before U.S. Midterms as Oil Supply Stays Tight

According to Jin10, Middle East risks continued to push oil prices higher, keeping the Indian rupee under downward pressure against the U.S. dollar. The dollar edged up to around 95.25 rupees in Friday’s opening trade, near the more-than-two-week high of 95.38 reached in the previous session. Rising oil prices typically weigh on currencies in economies such as India, which rely heavily on oil imports to meet energy needs. TD Securities said a stream of reports about a possible deal ahead of the U.S. midterm elections was putting significant pressure on crude prices, with ongoing negotiation news weighing on the market. The firm expected this trend to continue until the election, but said Iran was unlikely to agree to a deal during the tense pre-election period. TD Securities said fundamentals remained tight, noting that attacks on oil tankers and pressure from the Houthis appeared to have reduced oil shipments from the Middle East, at least temporarily. The firm said energy prices should remain well supported in their current higher range as long as ongoing attacks sustain a risk premium in the market.