Crude Oil Prices Drop Below $100 as Traders Brace for Trump Speech
Crude Oil Prices Drop Below $100 as Traders Brace for Trump Speech
- Crude oil prices fall ahead of Trump speech as traders look for clarity.
- The EIA reported a 5.5 million barrel crude inventory build for the week ended March 27, beating expectations.
- Prices remain volatile and highly elevated from pre-war levels.
Crude oil prices fall ahead of Trump speech
Crude oil futures (/CLK6) traded below $100 a barrel on Wednesday, as geopolitical risk premium eased ahead of Wednesday night when President Trump is expected to address the nation.
The speech will focus on the Iran war. Trump told reporters recently that he expects the war to be over in two or maybe three weeks. He is expected to outline the military achievements made since the war started on February 28.
While prices have eased in the last several days, oil remains nearly unchanged on the week. Tonight’s speech could have implications for oil prices, but a U.S. withdrawal from the conflict doesn’t guarantee lower oil prices.
The messaging from the White House has been at times contradictory, and until the market sees a material change in on-the-ground conditions, especially in the Strait of Hormuz, oil prices will likely remain elevated.
On Wednesday, Trump said that a reopening of the strait is a condition for ending the war, but before that, a Wall Street Journal report said Trump was willing to end the war without a full reopening. Traders will be looking for clarity in tonight’s speech.
EIA shows oil inventories rise by 5.5 million barrels
According to the Energy Information Administration (EIA), crude oil inventories in the U.S. rose 5.5 million barrels in the week ended March 27. Traders were expecting an increase of about 800k barrels.
The numbers didn’t have much impact on prices, with the market laser-focused on the situation in the Middle East. The geopolitical premium and loss of supply from the Middle East remain the driving force for prices. About one-fifth of global oil flows move through the Strait of Hormuz.
A notable in the report was that exports of total petroleum products rose to the highest ever recorded. Imports fell to a multi-year low. The flow of oil out of and into the United States shows that the displacement of crude in the Middle East is adding to demand for U.S. oil and fuel products. This will likely continue in the coming weeks to months, depending on how long the strait remains closed.
Trading crude oil futures
Crude oil prices (/CLK6) were 2% lower in afternoon trading on Wednesday, but prices in the next contract (/CLM6) were down by about 3% during the same time. This resulted in the prompt spread increasing to a backwardation of 9$ a barrel, the steepest on record. Demand for oil is concentrated heaviest along the near-term contract, reflecting the supply shock remains alive and well in the market.
Shorting the /CLM6 contract would likely benefit more than a play on the /CLK6 contract, since the further-out /CLM6 is slightly more insulated from immediate oil needs during the conflict. With a still-elevated volatility in the product, selling a call spread above the recent high at 99.65 from Tuesday’s price range offers a way to be directionally neutral to bearish while betting that some volatility will come out of the product.
Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.
tastylive content is created, produced, and provided solely by tastylive, Inc. (“tastylive”) and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involve risk and may result in a loss greater than the original amount invested. tastylive, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. tastylive is not in the business of transacting securities trades, nor does it direct client commodity accounts or give commodity trading advice tailored to any particular client’s situation or investment objectives. Supporting documentation for any claims (including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request. tastylive is not a licensed financial adviser, registered investment adviser, or a registered broker-dealer. Options, futures, and futures options are not suitable for all investors. Prior to trading securities, options, futures, or futures options, please read the applicable risk disclosures, including, but not limited to, the Characteristics and Risks of Standardized Options Disclosure and the Futures and Exchange-Traded Options Risk Disclosure found on tastytrade.com/disclosures.
tastytrade, Inc. ("tastytrade”) is a registered broker-dealer and member of FINRA, NFA, and SIPC. tastytrade was previously known as tastyworks, Inc. (“tastyworks”). tastytrade offers self-directed brokerage accounts to its customers. tastytrade does not give financial or trading advice, nor does it make investment recommendations. You alone are responsible for making your investment and trading decisions and for evaluating the merits and risks associated with the use of tastytrade’s systems, services or products. tastytrade is a wholly-owned subsidiary of tastylive, Inc.
tastytrade has entered into a Marketing Agreement with tastylive (“Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’s brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade. tastytrade and Marketing Agent are separate entities with their own products and services. tastylive is the parent company of tastytrade.
tastyfx, LLC (“tastyfx”) is a Commodity Futures Trading Commission (“CFTC”) registered Retail Foreign Exchange Dealer (RFED) and Introducing Broker (IB) and Forex Dealer Member (FDM) of the National Futures Association (“NFA”) (NFA ID 0509630). Leveraged trading in foreign currency or off-exchange products on margin carries significant risk and may not be suitable for all investors. We advise you to carefully consider whether trading is appropriate for you based on your personal circumstances as you may lose more than you invest.
tastycrypto is provided solely by tasty Software Solutions, LLC. tasty Software Solutions, LLC is a separate but affiliate company of tastylive, Inc. Neither tastylive nor any of its affiliates are responsible for the products or services provided by tasty Software Solutions, LLC. Cryptocurrency trading is not suitable for all investors due to the number of risks involved. The value of any cryptocurrency, including digital assets pegged to fiat currency, commodities, or any other asset, may go to zero.
© copyright 2013 - 2026 tastylive, Inc. All Rights Reserved. Applicable portions of the Terms of Use on tastylive.com apply. Reproduction, adaptation, distribution, public display, exhibition for profit, or storage in any electronic storage media in whole or in part is prohibited under penalty of law, provided that you may download tastylive’s podcasts as necessary to view for personal use. tastylive was previously known as tastytrade, Inc. tastylive is a trademark/servicemark owned by tastylive, Inc.
Your privacy choices