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US Cash Crude-Grades broadly firm ahead of US tariffs on Canada, Mexico

ReutersMar 3, 2025 9:55 PM

- U.S. cash crude prices broadly strengthened on Monday, dealers said, as the market braced for the United States to impose tariffs on Mexico and Canada overnight.

President Donald Trump said on Monday there was no chance for Mexico or Canada to prevent the tariffs from taking effect on Tuesday, which was scheduled at 12:01 a.m. EST (0501 GMT). At that point Canada and Mexico would face tariffs of 25%, with 10% for Canadian energy.

Both coastal and inland crude grades firmed on Monday, with Mars Sour WTC-MRS strengthening to a $2.25 premium to U.S. crude futures CLc1, on par with its steepest since mid-December.

Canada's oilfield drilling and services sector is already showing signs of slowing due to Trump's threatened tariffs, triggering fears that an expected industry rebound could stall if such levies go forward.

In refining news, U.S. oil refiners are expected to have about 1.266 million barrels per day of capacity offline in the week ending March 7, decreasing available refining capacity by 159,000 bpd, research company IIR Energy said on Monday.

Meanwhile, OPEC+ has decided to proceed with a planned April oil output increase, the group said on Monday, a move that follows Trump renewing pressure on OPEC and Saudi Arabia to bring down prices.

Light Louisiana Sweet WTC-LLS for April delivery firmed 15 cents at a midpoint of a $3.90 premium and was seen bid and offered between a $3.80 and $4.00 a barrel premium to U.S. crude futures CLc1

Mars Sour WTC-MRS firmed 15 cents at a midpoint of a $2.25 premium and was seen bid and offered between a $2.15 and $2.35 a barrel premium to U.S. crude futures CLc1

WTI Midland WTC-WTM firmed 5 cents at a midpoint of a $1.1 premium and was seen bid and offered between a $1.00 and $1.20 a barrel premium to U.S. crude futures CLc1

West Texas Sour WTC-WTS firmed 10 cents at a midpoint of a 70-cent premium and was seen bid and offered between a 45-cent and 95-cent a barrel premium to U.S. crude futures CLc1

WTI at East Houston WTC-MEH, also known as MEH, traded between a $1.25 and $1.45 a barrel premium to U.S. crude futures CLc1

ICE Brent May futures LCOc1 fell $1.19 to settle at $71.62 a barrel

WTI April crude CLc1 futures fell $1.39 to settle at $68.37 a barrel

The Brent/WTI spread WTCLc1-LCOc1 narrowed 4 cents to last trade at minus $3.45, after hitting a high of minus $3.43 and a low of minus $3.59

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