Hedge funds have cut their bullish bets on crude oil to record lows as the market reacts to increasing U.S. inventories and fear that OPEC+ will not fully deliver on its promises to voluntarily cut production come January 1.Money managers have slashed their net long positions in both WTI and Brent crude oil by 59,094 lots to just 149,272 in the week ending December 12. This is “the lowest in exchange and regulatory data going back to 2011,” Bloomberg suggested on Friday. The record lows were a result of short-only bets reaching to the highest in nearly four years, while long-only bets fell, ICE Futures Europe and the Commodity Futures Trading Commission data show.
Crude oil prices have been on the decline over the last month, although spot prices for both benchmarks were trading up on Friday. WTI was trading up $0.21, at $71.79 per barrel on Friday afternoon, a 0.29% increase on the day. While an increase on the day, it is down from $76.79 a month ago. Brent crude oil prices were also trading up on the day, at $76.90 per barrel, trading up $0.29 per barrel (0.38%). Brent was trading at $81.18 per barrel just a month ago.
The news comes just a couple days after the Energy Information Administration (EIA) lowered its crude oil forecast for 2024. In December’s Short Term Energy Outlook (STEO), the EIA forecast that Brent crude oil would trade at an average of $93 per barrel, it is a decrease from the forecast the agency published in November. As for OPEC+, the EIA estimated that OPEC+ crude production would fall by another 600,000 bpd next year.Crude oil prices fell on Tuesday by more than 4% to a six-month low as the consumer price index in the United States increased.
Source:https://oilprice.com