Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner.

Oil optimism slumps to 12-week low as price dips to bear market

Photographer: Luke Sharrett/Bloomberg
Photographer: Luke Sharrett/Bloomberg

Hedge funds kept running away from oil as prices tumbled into a bear market.

They cut bets on West Texas Intermediate crude’s rally to the lowest level in 12 weeks, according to data released Friday. Optimism on Brent crude, the global benchmark, declined by the most this year.

WTI reached bear territory last Wednesday, dropping more than 20% from its April high amid escalating disputes between the U.S. and its trading partners. Prices rebounded toward the end of the week as Saudi Arabia and Russia reiterated their commitment to supply cuts, leaving it unclear whether investors had made the right call.

“The zeitgeist of the oil market is that it wants to track the broader macro environment,” said Tamar Essner, Nasdaq’s director of energy & utilities. “A lot hinges on what the outlook for the global economy looks like, which really hinges on a trade deal.”

The net-long WTI position — the difference between bets on a price increase and wagers on a decline — fell 8.5% to 183,372 futures and options contracts in the week ended June 4, the U.S. Commodity Futures Trading Commission said. Long positions fell 6.1%, while short-selling wagers ticked up 3.2%.

“People were trimming but they weren’t running for the exits,” said Rob Haworth, who helps oversee $159 billion at U.S. Bank Wealth Management in Seattle. With more optimistic news for oil bulls near the end of the week, investors still had “room to get more constructive on prices,” he said.

Other positions: The net-long position on Brent slid by 14% to 304,327, the biggest decline since early December. Longs fell by 13%, but shorts also declined by 5%. The net-long position on benchmark U.S. gasoline dropped 11% to 82,011 contracts, also the lowest in 12 weeks. The net-short diesel position jumped by 72% to the most bearish in almost two years.

Recommended for you

More from Energy Voice

Latest Posts