* Markets volatile as U.S. election outcome unclear
* Latest on U.S. presidential race https://amers1.apps.cp.thomsonreuters.com/cms/?navid=20856
* Multimedia cover https://www.reuters.com/world/us-election2020
(Adds detail, updates prices)
By Devika Krishna Kumar
NEW YORK, Nov 4 (Reuters) - Oil prices rose more than 3% on
Wednesday after President Donald Trump falsely claimed victory
in a tight U.S. election with millions of votes still to be
counted and after data showed a large decline in U.S. crude
inventories.
A victory by Trump is viewed as bullish for oil because of
sanctions on Iran and his support for Saudi-led oil production
cuts to support prices.
A contested result and prolonged uncertainty is seen as the
most bearish outcome for oil and markets in general, while a win
for Joe Biden would be seen as bearish to neutral because of his
support for green policies and softer stance on Iran.
West Texas Intermediate CLc1 was up $1.28, or 3.4%, at
$38.94 a barrel by 12:44 p.m. ET (1744 GMT.) Brent crude LCOc1
was up by $1.36, or 3.4%, at $41.07 a barrel.
Both benchmarks extended gains to session highs after data
showed U.S. crude inventories fell 8 million barrels last week
as Hurricane Zeta forced production declines in the Gulf of
Mexico during the period. EIA/S
U.S. weekly crude oil exports fell by 1.2 million barrels
per day (bpd) to about 2.3 million bpd last week, the biggest
drop since January, and production dropped 600,000 bpd to 10.5
million bpd. Trump falsely claimed to have won after his Democratic
challenger Biden said he was confident of winning a contest that
will not be resolved until a handful of states finish vote
counts in the next hours or days. "Perhaps the biggest conclusion to be drawn at this stage is
that there is only a small likelihood that existing oil & gas
tax incentives will be removed in the U.S. – even if Biden
emerges as the winner – given the narrow margin of victory and a
probable Republic majority in the U.S. Senate," said Artem
Abramov, head of shale Research at Rystad Energy.
Wall Street surged and U.S. dollar gained against a basket
of currencies, as the too-close-to-call presidential election
left traders betting on a divided Senate that would keep
stimulus flowing but hold tax rises and regulation in check.
MKTS/GLOB prices were also supported by the possibility that OPEC
producers and Russia could consider deferring a planned increase
in OPEC+ oil output from January as a second coronavirus wave
stifles a recovery in fuel demand.
The Organization of the Petroleum Exporting Countries (OPEC)
and allies led by Russia, a grouping known as OPEC+, earlier
agreed to ease cuts by 2 million barrels per day from the
current 7.7 million bpd from January.
More lockdowns could, however, cap oil price gains and weigh
on demand. Italy, Norway and Hungary have tightened coronavirus
curbs, following Britain, France and other countries.
Britain recorded 492 new COVID-19 deaths on Wednesday, the
biggest toll since May 13 and up from 397 on Tuesday, government
data showed. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
CHART: Brent oil may retest resistance at $40.41
Global oil supply and demand https://tmsnrt.rs/2HLuEgx
FACTBOX: Who is winning the U.S. presidential election?
U.S. oil may rise to $39.80 Global Markets since Trump 2016 election https://tmsnrt.rs/3jOJWOt
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>