Investors have not decided on the up or down button to move oil prices, but the optimists and pessimists expect the price of a barrel will change, according to Bloomberg. According to the Agency, the total number of long and short positions speculators who buy futures and options on WTI, according to data on February 2, peaked in 2006, when the U.S. Commission on commodity futures trading (CFTC) began to keep statistics.
“The situation reflects the belief on both sides. We see a battle Royal between those who believe that the bottom has been reached, and those who believe that [oil] in reaching an agreement,” explained Bloomberg partner of new York hedge Fund Again Capital John Kilduff.
The number of short contracts for the week ending on 2 February 2016, according to the CFTC grew by 9.7%, coming close to the absolute maximum reached in January 2016. The number of long contracts, the owners of which are betting that oil prices will grow, also grew, but at a slower rate.
“It’s a difference of opinion about where the market will move. Ultimately, the shorts still win,” — said the energy market analyst new York company Citi Futures Perspective Tim Evans.
Speaking about the reasons for the dominance on the oil market “bears”, Evans recalled the growth of crude oil reserves in the United States. According to the energy information Administration US (EIA), to 29 January 2016 its volume has exceeded 500 million barrels, exceeding analysts ‘ forecasts and reaching a maximum in 1930.
“Any commodity market where stocks are at their highest level in 85 years, will be bearish,” said Evans.
During today’s trading on the stock exchange ICE cost of a barrel of WTI ranged between $30 and $32, the barrel Brent — between $33 and $35. The prices for both brands of oil show weak growth.
Previously one of the largest investment banks Morgan Stanley has lowered its forecast for oil prices. According to the experts, contrary to earlier forecasts, world oil prices in the second half of 2016 will not grow and may even fall further. If that was previously provided for the forecast increase in the average cost of a barrel of Brent in the October—December 2016 to $59, now experts are expecting no growth, and falling to $29.