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 18 August.

IMAGE: Oil pump jack. Getty Images

Speculators bought over 11,000 lots as of 18 August, increasing net-long positions in Brent futures to a little short of 252,000 lots.

The surge in net-long positions marks the second consecutive week of rise. The increase was primarily driven by short bets liquidating, rather than fresh long buying, according to futures and options data from ICE Futures Europe.

Gross-long positions in Brent futures increased by about 9,000 lots during the week.

The increase in net-long bets comes as hopes of a diplomatic breakthrough between Washington and Tehran continue to fade, keeping commercial navigation through the Strait of Hormuz choked.

Brent crude remains caught between relentless attacks on critical energy infrastructure and fading hopes of a US-Iran diplomatic breakthrough.

When speculators boost net-long positions, prices typically rise. Conversely, when they reduce these positions, oil 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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