US Cash Crude-Offshore grades fall as Trump de-escalation comments ease supply disruption concerns

By Siddharth Cavale

NEW YORK, March 10 (Reuters) - Grades fell sharply on Tuesday, dealers said, as expectations of prolonged supply disruptions eased after U.S. President Donald Trump predicted that the war with Iran could end soon.

Trump, in a late Monday address, said the United States had inflicted serious damage on Iran's air force and navy and predicted the conflict would end well before the initial four-week time frame he had laid out, though he has not defined what victory would look like.

And on Tuesday, U.S. Energy Secretary Chris Wright wrote on X that the American military had facilitated a shipment of oil out of the Strait of Hormuz. Minutes later he deleted the post, with the White House confirming that no commercial ships were escorted through the Strait of Hormuz by the U.S. military.

A growing number of refineries in Southeast Asia, which are reliant on Middle East oil, have also cut back output due to constrained crude availability due to the war,sources told Reuters. Nearly 1.9 million barrels per day of crude refining capacity was shut-in in the Middle East due to the U.S.-Israeli war on Iran, consultancy IIR said on Tuesday.

Brent oil prices are set to trade above $95 a barrel over the next two months as the Iran war disrupts supplies, before falling to around $70 by the end of the year, the Energy Information Administration (EIA) said on Tuesday in a monthly report. Higher oil prices are also set to encourage more U.S. crude production, with output expected to average 13.61 million barrels per day this year, rising to 13.83 million bpd in 2027, the EIA said.

U.S. crude, gasoline and distillate inventories fell last week, according to market sources citing data from the American Petroleum Institute. Crude stocks dropped by 1.68 million barrels in the week ended March 6, the sources said, speaking on condition of anonymity.

• Light Louisiana Sweet for April delivery fell $6.50 to a midpoint of a $3.00 premium and was seen bid and offered between a $1.00 and $5.00 a barrel premium to U.S. crude futures CLc1 ​

• Mars Sour fell by $9.75 to a midpoint of a $3.25 premium and was seen bid and offered between a $3.00 and $3.50 a barrel premium to U.S. crude futures CLc1 ​

• WTI Midland fell 20 cents to a midpoint of a 70-cent premium and was seen bid and offered between a 20-cent and $1.20 a barrel premium to U.S. crude futures CLc1 ​

• West Texas Sour fell 70 cents to a midpoint of a 35-cent discount and was seen bid and offered between a 50-cent and 20-cent a barrel discount to U.S. crude futures CLc1

• WTI at East Houston, also known as MEH, traded between a premium of $1.30 and $1.79 a barrel to U.S. crude futures CLc1 ​

• ICE Brent May futures LCOc1 fell $11.16 to settle at $87.80 a barrel on Tuesday​.

• WTI April crude CLc1 futures fell $11.32 to settle at $83.45 a barrel on Tuesday​.

• The Brent/WTI spread narrowed $1.44 to last trade at minus $6.04, after hitting a high of minus $5.27 and a low of minus $7.26.