Money managers reduced bullish bets on Brent and WTI crude by over 27,600 lots in the week to August 4 amid geopolitical uncertainty.
Hedge funds and other money managers reduced their net long positions in crude oil futures for the second consecutive week, despite ongoing tensions in the Strait of Hormuz. Net longs in NYMEX WTI fell by 7,257 lots to 101,050 lots in the week ending August 4, while ICE Brent saw a sharper decline of 20,361 lots, or 11%, to 164,722 lots.
The reductions follow a period of elevated bullish sentiment, with prior weeks showing modest increases in net longs. Market participants had previously priced in supply risks tied to Middle East tensions, but lack of progress on reopening key shipping lanes may have prompted the pullback. Comparable data from earlier in the year showed net longs fluctuating around similar levels.
No immediate market reaction was detailed in the data, though the shift in positioning may signal cautious sentiment among traders ahead of further geopolitical developments.