Money managers downgraded their net-bullish Brent oil forecasts by the biggest level, the previous week.
- The rebound shows that wild swings across the oil market are part of a broad-based liquidation of positions, with oil futures seeing speculators closing out long contracts.
- The recovery in Brent was attributable to the largest reduction in outright bullish bets starting 2018. Last week, the global crude benchmark rose close to $140 per barrel for the first time since 2008.
- Crude prices have been highly volatile since Russia’s invasion of Ukraine. Last week, Brent traded in its biggest weekly range since the unveiling of futures in the late 1980s.
- Ole Hansen, head of commodity strategy at Saxo Bank stated that long liquidation across the three fuel products added the story of speculations limiting exposure.
Even though the decline in bullish positioning was sizable, there are significant addition of outright bearish oil bets since 2016, nearly 34,000 contracts.
CL1! down -4.96%, USOIL down -4.02%