Oil futures dropped as much as 2% on Wednesday before paring losses as traders weighed what Donald Trump's presidential victory could mean for energy prices.

On Wednesday West Texas Intermediate (CL=F) futures hovered around $72 per barrel while Brent (BZ=F), the international benchmark, traded just above $75 per barrel.

Oil, which is invoiced in dollars, sank as the US Dollar Index (DX-Y.NYB) seeing its biggest jump since 2016.

The president elect has promised to end the the Ukraine-Russia war and has advised Israel to wind down the Gaza conflict quickly. Both conflicts have kept upward pressure on oil prices this year.

Trump has also indicated he wants to boost oil supply, although analysts have said that is easier said than done. Earlier in the campaign, he promised to "drill, baby, drill" to send down energy prices.

He nodded to the country's vast supply in his early morning victory speech Wednesday.

“We have more liquid gold, oil and gas. We have more liquid gold than any country in the world. More than Saudi Arabia. We have more than Russia,” President elect Trump said.

Trump's promise for more tariffs also weighed on prices in early trading as traders assessed the outlook for demand from the world's biggest oil importer, China.

'Tariffs may ultimately impact trade between the USA and China, negatively affecting the Chinese economy and the growth in oil demand," Andy Lipow, president of Lipow Oil Associates told Yahoo Finance on Wednesday.

Earlier this week oil jumped after The Organization of the Petroleum Exporting Countries, along with Russia and other countries, said it would delay bringing more supply onto the market until the end of 2024.

Expectations that Iran is planning a "strong and complex" attack against Israel in the ongoing Middle East conflict also sent crude higher earlier this week.

Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.

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