For the oil market, voting for Trump or Biden is a sideshow that hardly affects the price, according to Swiss bank Julius Baer  

The price of oil falls from its barrier of 38 dollars/barrel, but the causes must be seen beyond what is in the front line of the media in relation to the elections involving Donald Trump and Joe Biden.  

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According to Norbert Rücker, head of economics and state-of-the-art research at the Swiss bank Julius Baer, the suspense over America's vote grabs our attention and shakes financial markets, including oil. However, while absorbing much of our attention, the US vote is mostly a sideshow for the oil market and is unlikely to drive established trends whether Trump or Biden is elected.  

Oil supply is decreasing

The suspense about voting for Joe Biden or Trump in the United States causes some volatility in oil markets. But after an initial spike, prices dropped to $38 a barrel.  

For this reason, for the analysts of this Swiss entity, “we still believe that the US vote is mainly a sideshow that will hardly lead to established trends”.  

That said, the result of the Biden and Trump vote could be somewhat negative for the US dollar, resulting in a slight tailwind for commodities in general.

And when it comes to the end of the elections, what will happen?

Finally, the election result between Biden and Trump carries some major political risks, such as the possible reduction of tensions with Iran. The country's return to the oil market would, of course, delay the normalization process, but it remains open if this happens in volumes that overload the oil market.

The oil market is likely to continue experiencing supply shortages, a trend that official US statistics continue to confirm, and market sentiment could only improve from today's depressed levels.