The Oil price fell sharply today before recovering in late trading on the back of a huge upset in the US presidential election which threw the markets worldwide into a tailspin.
Crude fell as much as 4 percent early in the session to around $43, a near two month low following the announcement of the U.S. presidential election results where Donald Trump pulled of the biggest election upset of a generation by beating Hilary Clinton.
The market, and investors in general had not priced in such a scenario happening, so investors dumped riskier assets such as oil, the Canadian and Australian dollars in favor of safe haven assets such as gold.
Trumps victory is likely to put more pressure on the oil price in the nearest future as it is expected to create uncertainty in the markets until his policies become clearer.
"The outcome of the U.S. election adds to the challenges for the oil exporters because it likely leads to weaker economic growth in an already fragile global economy," said Daniel Yergin, vice-chairman of analysis firm IHS Markit. "
And that means additional pressure on oil demand." he added.
One of the policies Mr Trump has promised to follow through on is the pledge to open up all Federal lands for oil production as well as restarting the Keystone pipeline project, which if successful will add another glut of oil to the market and in turn push prices down further.
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