Oil Traders’ Bearish Turn Signals Prices May Stay Low
- Options, futures markets show increasingly downbeat wagers
- US crude prices plunged 14% this month to sink below $70
This article is for subscribers only.
Ask the world’s biggest oil traders where the market is headed as prices hover near a 15-month low, and you’ll hear almost universal agreement: The stage is set for a rally.
But an examination of trading data tells a much different story. In the past two weeks, speculators have cut bullish positions in US crude to the lowest in more than a decade while bets on a downturn are at a four-year high. The options market shows similar pessimism in the so-called put skew, a measure of bearishness.