Speculators cut gasoil, raise Brent net longs: ICE

LONDON: Speculators cut their net long positions in gasoil but raised slightly their long exposure to Brent crude in the week to Aug. 16, data published by the Intercontinental Exchange (ICE) showed on Monday.

Hedge funds and other money managers reduced net longs in ICE gas oil by 10,646 contracts to 32,892 but increased net longs in ICE Brent by 756 contracts to 49,608, the data showed.

The figures broadly confirm a trend evident on Friday in data published by the US Commodity Futures Trading Commission (CFTC).

The CFTC data showed money managers had raised their combined net long position in US crude oil futures and options by 6,291 positions to 166,329 contracts in the week to Aug. 16.

In heating oil during the same period, the money manager group reduced net longs by 2,659 contracts to 27,916.

The week to Aug. 16 saw a recovery in oil prices after sharp falls the previous week on signs of slowing growth in the developed Western economies.

Traders said many investors appeared to have decided that oil consumption in Europe and the United States was declining and therefore it could be time to shed some exposure to oil.

Money managers had already reduced dramatically their net long positions in ICE Brent in the week to Aug. 9, cutting them by almost half.

Olivier Jakob, oil market consultant at Petromatrix in Zug, Switzerland, said the slight increase in net longs in Brent probably also reflected a rally in crude prices after the earlier dramatic sell-off.

"There has been some bottom-picking activity and I think that is what we are seeing in that data," Jakob said.

Copyright Reuters, 2011