AGL 6.80 Increased By ▲ 0.08 (1.19%)
ANL 9.22 Decreased By ▼ -0.53 (-5.44%)
AVN 74.20 Decreased By ▼ -1.30 (-1.72%)
BOP 5.43 Decreased By ▼ -0.01 (-0.18%)
CNERGY 4.89 Decreased By ▼ -0.06 (-1.21%)
EFERT 78.00 Decreased By ▼ -0.05 (-0.06%)
EPCL 54.70 Decreased By ▼ -0.70 (-1.26%)
FCCL 14.93 Decreased By ▼ -0.37 (-2.42%)
FFL 6.34 Decreased By ▼ -0.14 (-2.16%)
FLYNG 7.12 Decreased By ▼ -0.03 (-0.42%)
GGGL 10.56 Increased By ▲ 0.01 (0.09%)
GGL 16.43 Decreased By ▼ -0.12 (-0.73%)
GTECH 8.21 Decreased By ▼ -0.21 (-2.49%)
HUMNL 6.35 Decreased By ▼ -0.06 (-0.94%)
KEL 2.95 Decreased By ▼ -0.04 (-1.34%)
LOTCHEM 28.60 Decreased By ▼ -0.25 (-0.87%)
MLCF 27.80 Decreased By ▼ -0.50 (-1.77%)
OGDC 75.30 Decreased By ▼ -0.20 (-0.26%)
PAEL 15.80 Increased By ▲ 0.26 (1.67%)
PIBTL 5.60 Increased By ▲ 0.24 (4.48%)
PRL 17.22 Decreased By ▼ -0.10 (-0.58%)
SILK 1.06 Increased By ▲ 0.01 (0.95%)
TELE 10.30 Decreased By ▼ -0.20 (-1.9%)
TPL 8.00 No Change ▼ 0.00 (0%)
TPLP 20.80 No Change ▼ 0.00 (0%)
TREET 22.60 Decreased By ▼ -0.40 (-1.74%)
TRG 128.85 Increased By ▲ 6.15 (5.01%)
UNITY 22.50 Decreased By ▼ -0.08 (-0.35%)
WAVES 12.00 Increased By ▲ 0.70 (6.19%)
WTL 1.13 Decreased By ▼ -0.01 (-0.88%)
BR100 4,100 Decreased By -4 (-0.1%)
BR30 15,533 Increased By 64.6 (0.42%)
KSE100 41,129 Increased By 114.8 (0.28%)
KSE30 15,337 Increased By 24.6 (0.16%)
Follow us

LONDON: Hedge funds were big buyers of petroleum for the fourth week running, boosting their bullish position to its highest for more than 30 months, as US shale firms declined to respond to rising prices.

Hedge funds and other money managers purchased the equivalent of 51 million barrels in the six most important petroleum futures and options contracts in the week to June 22.

Portfolio managers have purchased a total of 168 million barrels in the four most recent weeks, taking their total position to 996 million, the highest since October 2018.

Investors have not been this bullish since before the coronavirus epidemic spread worldwide in early 2020 and the US/China trade war intensified in late 2018. Last week’s purchases were focused on NYMEX and ICE WTI (+47 million barrels) with small buying in US gasoline (+8 million) and US diesel (+6 million), but sales in Brent (-3 million) and European gas oil (-8 million).

Fund buying has concentrated heavily on US crude contracts, with the combined NYMEX and ICE position up by 105 million barrels over the last four weeks, accounting for more than 60% of the total.

US shale producers have declined to add extra drilling rigs or boost output significantly despite the rise in prices. The number of rigs drilling for oil is less than half that when prices were last at this level in 2018.

US commercial crude inventories fell below the pre-epidemic five-year average for 2015-2019 for the first time in the first week of June, in a signal the market is tightening rapidly.

Crude stocks around the NYMEX WTI delivery point at Cushing are already 12 million barrels or 22% below the pre-epidemic five-year average and still trending lower.

The number of hedge fund short positions in NYMEX WTI fell to a three-year low in the middle of June, though it rose again slightly last week.

Portfolio managers are becoming increasingly bullish even though prices are already well above the average in real terms, responding to indications that shale producers will continue to hold back production.

Comments

Comments are closed.