Brent fell $2.87 per barrel (bbl) last week to average $77.39/bbl. West Texas Intermediate (WTI) fell $2.78/bbl to average $67.47/bbl. For the week ahead we see Brent weakening slightly more, averaging $75/bbl, perhaps slightly higher. We think Brent is likely nearing the price floor, and technical indicators seem to confirm that recent price movements have been fairly balanced.

With the November deadline quickly approaching, and major customers continuing to buy Iranian crude oil, pressure is increasing on the White House to issue waivers. If waivers are issued this week, prices would be much more likely to reach $75/bbl as supply concerns are mitigated.

Markets reacted positively to news that Jair Bolsonaro won the Brazil presidential election, but risks abound. For much of Bolsonaro’s political career he has been an economic nationalist, which means he is unlikely to support nationalizing assets such as oil production and electricity generation.