Speculators hike net-long positions in Brent

Money managers and hedge funds have increased their net-long bets on ICE Brent futures, in the week to 10 March.

IMAGE: Crude oil barrels stored in underground salt caverns. Getty Images

Speculators bought a little short of 65,500 lots as of last Tuesday, increasing net-long positions in Brent futures to over 351,000 lots.

Gross-long positions in Brent increased by more than 41,000 lots during the week, according to futures and options data from ICE Futures Europe.

The latest data mark “the largest net long held since February 2020,” two analysts from ING Bank said.

“The move was driven primarily by fresh longs entering the market, with gross longs increasing by 41,854 lots week-on-week,” the analysts added.

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

Iran is the third-largest OPEC member, producing around 3.2 million b/d of crude oil. Market analysts have warned that targeting Tehran’s oil infrastructure could drive global oil prices sharply higher.

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

By Aparupa Mazumder

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