NEW YORK, March 27 (Reuters) - Grades rose on Friday, dealers said, as U.S. rig counts, an early indicator of future production, fell for the second straight week, and traders bet Iran war-related supply disruptions would last several more weeks.
A closely watched Baker Hughes report on Friday showed that U.S. energy firms this week cut the number of oil and natural gas rigs operating for a second week in a row. The decrease marks the first time since early February that rig counts have fallen for two consecutive weeks.
The U.S. expects its operation against Iran to conclude within weeks, not months, and Washington can meet all its objectives without using ground troops, U.S. Secretary of State Marco Rubio said on Friday. Futures prices have been rising, however, in the expectation that the disruptions will limit supply into the summer. U.S. crude futures CLc1 settled up 5.5% on Friday.
On the demand side, U.S. oil refiners are expected to have about 1.03 million barrels per day of capacity offline in the week ending March 27, decreasing available refining capacity by 287,000 bpd, research company IIR Energy said.
Offline capacity is expected to fall to 886,000 bpd in the week ending April 3, IIR said on Friday.
Light Louisiana Sweet for May delivery eased to a $6.00 premium midpoint, seen bid and offered between a $3.00 and $9.00 a barrel premium to U.S. crude futures
Mars Sour rose $4 to a midpoint of a $12 premium and was seen bid and offered between a $11.80 and $12.20 a barrel premium to U.S. crude futures
WTI Midland rose 55 cents to a midpoint of a $2.70 premium and was seen bid and offered between a $2.50 and $2.90 a barrel premium to U.S. crude futures
West Texas Sour rose 65 cents to a midpoint of a $1.80 premium and was seen bid and offered between a $1.70 and $1.90 a barrel premium to U.S. crude futures
WTI at East Houston, also known as MEH, traded between a $3.80 and $4.20 a barrel premium to U.S. crude futures
ICE Brent May futures LCOc1 rose $4.56 to settle at $112.57 a barrel on Friday. WTI May crude CLc1 futures rose $5.16 to settle at $99.64 a barrel.
The Brent/WTI spread widened 11 cents, putting WTI at a discount of $13.64 to Brent, after narrowing at one point to $12.55 and reaching its widest level of $14.41 on the day.
(Reporting by Siddharth Cavale in New York; Editing by David Gaffen)
((Siddharth.Cavale@tr.com))