Speculators cut net-long positions in Brent

Money managers and hedge funds have decreased their net-long bets on ICE Brent futures, in the week to 24 March.

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Speculators sold over 21,000 lots as of last Tuesday, decreasing net-long positions in Brent futures to a little more than 407,000 lots.

Gross-long positions in Brent decreased by more than 18,000 lots during the week, according to futures and options data from ICE Futures Europe.

Commenting on the latest positions data, two analysts from ING Bank said the decline was “driven largely by a reduction in gross longs.”

Geopolitical risks surrounding US-Israel conflict with Iran remain a key driver of speculative activity, according to market analysts.

“Ongoing geopolitical uncertainty and supply risks have continued to underpin risk‑on positioning in the oil market so far this year,” ING Bank’s analysts said.

The Middle East conflict has curtailed oil flows across the region and forced output cuts by Arab producers.

“Positioning data shows speculative interest remains elevated despite some trimming,” ING Bank’s analysts added.

When speculators reduce net-long positions, prices tend to decline. Conversely, when they boost these positions, oil prices typically rise, leading to a cycle where their actions can influence oil prices and the market.

By Aparupa Mazumder

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