Speculators raised bullish bets on Brent crude ahead of OPEC -ICE
Investors raised their bullish bets on Brent crude oil to a four-week high in the week to May 23 ahead of OPEC’s meeting over whether to extend output cuts, data from the InterContinental Exchange (ICE) showed.
Hedge funds and money managers increased their net long positions on Brent crude by 51,453 contracts to 347,852, the data showed.
The rise was mostly fuelled by a closing of short positions, which fell by 38,863 contracts to 124,161. Long contracts rose by 12,590 to 472,013.
The Organization of the Petroleum Exporting Countries and other oil-producing nations met in Vienna on May 25, where they agreed to extend for nine months output cuts of roughly 1.8 million barrels per day.
Prices slid following the meeting, which analysts attributed to investor disappointment over the scope of OPEC’s action.
Hedge funds also raised bullish bets on U.S. crude for the first time in five weeks in the week to May 23, data from the U.S. Commodity Futures Trading Commission showed.
“Speculative financial investors built up massive net long positions in the run-up to the OPEC meeting,” Commerzbank said in a note. “Some of these new bets on rising prices are likely to have been wound up again after OPEC’s meeting, thereby putting pressure on prices.”
Source: Reuters (Reporting by Libby George; editing by Jason Neely)