Hedge Funds Cut ICE Brent Crude Net-Longs to Four-Month Low

Hedge funds and other money managers cut bullish bets on Brent crude to their lowest level in four months for a third consecutive week, according to data from ICE Futures Europe.

Speculative bets that prices will rise, in futures and options combined, outnumbered short positions by 99,127 lots in the week ended April 23, the London-based exchange said today in its weekly Commitment of Traders report. The reduction of 8,973 contracts, or 8.3 percent leaves so-called net-longs at their lowest since Dec. 11.

Bearish positions by producers, merchants, processors and users of Brent outnumbered bullish positions by 279,959, up by 26,396, or 10.4 percent. Net-shorts in this category are at the highest January 2011, the starting point for the data.

Brent crude advanced 1.8 percent to $101.73 a barrel in the week to April 23 on the ICE exchange, and traded for $103.10 a barrel as of 12:28 p.m. London time today.

Swaps dealers were net-long 228,225 lots, up 39,608 or 21 percent from a week earlier, in a 10th straight increase to their highest level since the data began.

Money managers’ net-long bets on European gasoil futures decreased by 15,847 contracts, or 82 percent, to 3,483, the lowest level since the data were published in January 2011.

Funds were net-short U.S. heating oil by 18,318 contracts on the New York Mercantile Exchange, the biggest net-short position since January 2007, according to data published on April 26 by the Commodity Futures Trading Commission.

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.

To contact the reporter on this story: Grant Smith in London at gsmith52@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

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