Net long positions on the rise in oil prices (i.e., the difference between rates on the rise and fall of oil prices) in three major oil benchmarks (WTI crude oil on the exchanges ICE and NYMEX, and Brent on ICE) amounted to 663 million barrels. While the rise in oil prices had been concluded contracts for the supply of 791 million barrels of oil, and to reduce the price of 128 million barrels of oil, according to Reuters.
As noted by Reuters analyst John Kemp, the previous largest peak rates on the rise in oil prices was noted in June 2014, when the net long positions amounted to 626 million barrels. Then he was called a threat to the oil fields in Iraq by the “Islamic state” (banned in Russia as a terrorist organization). Kemp stresses that the continued increase in the number of bets on a rise in oil prices reflects the growing risk that oil price may soon drop again. In fact, speculators inflate the oil bubble, threatening its collapse in the mass closure of long positions.
Since the beginning of the year, the number of long positions increased by 195 million barrels of oil equivalent, while cutting rates to reduce the price of oil amounted to 235 million barrels.
As noted by Reuters, if we evaluate the speculative factors in the price of oil (the number of long and short positions), then the oil should start to fall in the short term. However, the fundamental factors of supply and demand in the oil market say, rather, in favor of the fact that oil will continue to rise. In particular, the consumption of gasoline in the U.S. rose to record levels, while over the past year, oil production in the U.S. decreased by more than 3%.
The price of Brent crude oil on ICE Futures as of 18:00 MSK was $45,62 per barrel, WTI at stock exchange NYMEX cost $44,61 per barrel.
Previously surveyed by Bloomberg, experts said that the price of oil above $50 will allow large producers of raw materials to demonstrate acceptable financial results.