Hedge Funds Raise Brent Crude Net-Longs by Most in a Month

Feb 03, 2014 7:27 am ET

(Updates with producers in third paragraph.)

Feb. 3 (Bloomberg) -- Hedge funds and other money managers raised net bullish bets on Brent crude by the most in more than a month, according to data from ICE Futures Europe.

Speculative bets that prices will rise, in futures and options combined, outnumbered short positions by 98,271 lots in the week ended Jan. 28, the London-based exchange said today in its weekly Commitments of Traders report. The increase of 7,956 contracts, or 8.8 percent, is the biggest since Dec. 24 and brings net-long positions to their highest since Jan. 7.

Bearish positions by producers, merchants, processors and users of the North Sea crude outnumbered bullish wagers by 243,138 contracts, a decrease of 1,569 in their net-shorts.

ICE publishes, usually each Monday, aggregate numbers for long and short positions for speculators such as hedge funds and institutional investors, as well as commercial companies that buy or sell futures to protect against price moves. Analysts and investors follow changes in speculators’ positions because such transactions can reflect an expectation of a change in prices.

Brent futures rose 0.6 percent on the ICE exchange to $107.41 a barrel in the week to Jan. 28 and were at $106.16 as of 12:20 p.m. London time.

Swap dealers cut net-long positions in Brent for the first time in four weeks, trimming them by 4.5 percent to 207,360 contracts.

Money managers’ bullish bets on European gasoil rose for the second week by 3,124 contracts, or 6.3 percent, to 52,657 lots, ICE data show.

See ICCBBMMN <Index> GP <GO> for a chart of managed money net longs for ICE Brent.

--Editors: Raj Rajendran, Rachel Graham