Oil drops as geopolitical tensions ease despite U.S. standoff

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The stalemate in the U.S. continues as both sides seem far apart. On one side the President said he would open a door to talks if the Republicans would pass everything on both the budget and debt side with no variations. On the other side the Republicans want to negotiate a deal agreeable to both sides. Publically it still looks like a deal is far apart. However, what is going on behind closed doors is the unknown. The debt deadline is looming and the partial government slowdown is continuing for now.

Market uncertainty continues at an above normal level as global equities took another hit over the last 24 hours, while oil prices put in another volatile and mixed performance. This pattern is likely to continue until there is a sign that a deal is getting closer.

Global equities declined over the last 24 hours. The EMI Global Equity Index narrowed by 0.21% resulting in the year to date gains dropping back into negative territory (negative 0.20 percent) for the first time since the end of August. Global equities continue to be a negative price driver for the oil complex as well as the broader commodity markets.

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