Hedge funds walk into bear trap in oil: Kemp

5 Jul 2017   Prices

Hedge fund managers had amassed a record number of short positions in petroleum futures and options by the start of last week, which primed the oil market for a sharp short-covering rally at the end of the month. Hedge funds and other money managers held short positions in the five major contracts on crude, gasoline and heating oil amounting to 510 million barrels on June 27, according to regulatory and exchange data. Fund managers have added 200 million barrels of extra short positions since the end of May and 377 million barrels since crude prices peaked in the middle of February ( tmsnrt.rs/2tIamvF ). Hedge funds were even more pessimistic than in January 2016, with more short positions than when oil prices were touching their cyclical lows below $30 per barrel. Overall, fund […]

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