Speculators cut net-long positions in Brent
Money managers and hedge funds have reduced their net-long bets on ICE Brent futures in the week to 19 August.
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Speculators sold a little short of 24,000 lots as of last Tuesday, decreasing net-long positions in Brent futures to about 182,000 lots, according to futures and options data from ICE Futures Europe.
The decline in net-long positions comes as the oil market braces for the US-imposed 25% secondary tariffs on India’s purchases of Russian oil, set to take effect on 27 August.
“Speculators continue to reduce their net long in ICE Brent amid a bearish outlook,” according to two analysts from ING Bank. The gross-long positions in Brent fell by more than 20,000 lots during the week.
Front-month ICE Brent contract has lost momentum in recent days amid souring ties between Washington and key trade partners like India and China. Oil prices have also come under pressure due to concerns over a supply glut as OPEC+ output rises.
Commenting on the latest trend, the two ING Bank analysts said that “the move [decline in long-positions] was driven predominantly by longs liquidating.”
When speculators boost their net-long positions, oil prices typically rise. Conversely, when they reduce these positions, prices tend to decline, leading to a cycle where their actions can influence oil prices and the market.
By Aparupa Mazumder
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