Speculators reduce net-long positions in Brent

Money managers and hedge funds have reduced their net-long bets on ICE Brent futures in the week to 30 June.

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Speculators sold more than 34,000 lots as of 30 June, decreasing net-long positions in Brent futures to a little over 55,000 lots.

The drop in net-long positions marks the seventh consecutive week of reductions. The move comes amid a temporary peace accord between the US and Iran, expected to restore vessel traffic through the Strait of Hormuz.

The move can be attributed to fresh shorts entering the market, according to futures and options data from ICE Futures Europe. Gross-long positions in Brent futures decreased by nearly 12,000 lots during the week.

Brent futures are riding a turbulent rollercoaster, caught in high-stakes tug-of-war between hopes of diplomatic a breakthrough and the harsh reality of attacks targeting vital energy infrastructures and commercial vessels.

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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