Hedge Funds Cut Brent Crude Net-Longs From Three-Month High

Hedge funds and other money managers cut bullish bets on Brent crude from a three-month high, the first reduction in seven weeks, according to data from ICE Futures Europe.

Speculative bets that prices will rise, in futures and options combined, outnumbered short positions by 160,033 lots in the week ended June 11, the London-based exchange said today in its weekly Commitments of Traders report. The reduction of 4,871 contracts is the first since April 23.

Bearish positions by producers, merchants, processors and users of Brent outnumbered bullish positions by 363,879 lots, falling 4 percent from the previous week. The net-short position of 379,012 last week had been the highest since at least January 2011, the starting point for the data.

Brent fell 0.3 percent in the week to June 11 to $102.96, and traded at $106.11 a barrel as of 1:19 p.m. London time.

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.

Swaps dealers were net-long 245,348 lots, down 4.6 percent from a week earlier, when their net-long position was at its highest since May 14.

Money managers reduced net-short bets on European gasoil by 63 percent to 3,080 lots, bringing the net-short position to its smallest since April 23.

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 on sev@bloomberg.net

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