COT: Oil longs trimmed again ahead of spike
The Bloomberg Commodity Spot index reached a fresh record high during the week before ending close to unchanged after an 11% loss in natural gas offset broad gains across most other commodities and sectors. Once again, however, the continued turmoil in stocks and bonds lifting volatility probably prevented leveraged funds from adding exposure. As a result the combined net long across 24 major commodity futures held steady at 2.1 million lots. Long liquidation across the energy sector together with pockets of risk reduction across the agriculture sector led by corn and soybeans helped offset net buying of gold, copper, soybeans, cocoa and cattle.
Energy: Instead of adding fresh longs as crude oil rallied to a seven year high, speculators instead cut their net long for a third consecutive week. A decision probably driven by a loss of momentum as the market focused on the prospect for an Iranian deal, as well as elevated volatility across other assets forcing a broad reduction in exposure. During the past three weeks, an +8% rally in crude oil up until last Tuesday triggered a 5k lot increase in the gross short to 102k lots (One lot equals 1000 barrels) while profit taking reduced the gross long by 35k lots to 621k lots. Other major changes was a 30% reduction in the NY Harbor ULSD Diesel long while the 11% collapse in natural gas only attracted a 5% reduction driven by fresh short selling.
Read full report–> By Ole Hansen, Head of Commodity Strategy, Saxo Bank
Oil and gas, press , | Energy, Climate, Renewable, Wind, Biomass, Sustainability, Oil Price, LPG, Solar, Electric,
