Investing.com– Oil prices fell Wednesday, weighed by a surge in the dollar after Republican Donald Trump was elected president as well as a bigger than expected build in U.S. inventories. 

At 07:30 ET (12:30 GMT), fell 1.6% to $74.35 a barrel, while fell 1.6% to $70.83 a barrel. 

Trump returns to the White House

Donald Trump has been elected as the 47th president of the United States, returning to the White House for a second four-year term. 

The Republicans have also taken a majority in the Senate, the upper chamber of the US Congress, and were also on track to win the House of Representatives, raising the possibility of a Republican sweep in the 2024 elections.

Such a scenario would present an easier path for Trump to enact major policy changes, which many have seen as inflationary, boosting the US currency. As a result the US dollar was on course for its biggest single-day uptick since March 2020 against its other major currency pairs.

A stronger U.S. dollar makes commodities denominated in the greenback, such as oil, more expensive for holders of other currencies.

Additionally, a Trump presidency could see policies that may further pressure the Chinese economy, weakening oil demand in the world’s top crude importer.

US inventories grow more than expected – API 

Data from the , released on Tuesday, showed U.S. oil inventories grew 3.1 million barrels in the week to November 1, much more than expectations for a build of 1.8 mb.

Product inventories – gasoline and distillates – saw small draws.

The API data usually heralds a similar reading from , which is due later on Wednesday. The reading spurred some concerns that U.S. fuel demand was cooling, especially as the winter season approaches. 

U.S. production is also expected to have remained near record highs of over 13 mb a day, keeping supplies in the country relatively high.

But U.S. oil production is expected to face some disruptions in the coming days, especially as energy firms began evacuating workers in the Gulf of Mexico ahead of Hurricane Storm Rafael, which is expected to make landfall in Louisiana later this week. 

The storm strengthened into a category-1 hurricane on Tuesday. 

Busy week continues 

Oil prices were sitting on some gains in recent sessions, after the Organization of Petroleum Exporting Countries and allies, a group known as OPEC+, delayed plans to begin increasing production this year. 

Beyond the US election, the focus this week is on a meeting of China’s National People’s Congress, where Beijing is widely expected to outline more plans for fiscal spending.

A is also due on Thursday, with the central bank widely expected to cut interest rates by 25 basis points.

(Ambar Warrick contributed to this article.)