Hedge Funds Strongly Bet on Crude Oil
Hedge funds and other speculators raised their bullish bets on oil by the most on record fueled by speculation that Organization of the Petroleum Exporting Countries will agree next month to a production freeze deal with non-OPEC producers.
Money managers, including hedge funds, raised their net long U.S. crude futures and options positions in the week to Aug. 23 for the third consecutive week to the highest since early June, data from the U.S. Commodity Futures Trading Commission (CFTC) showed on Friday.
The speculator group raised its combined futures and options position in New York and London by a massive 88,924 contracts to 241,196 during the period, the biggest increase on record dating back to 2006.
U.S. crude futures rose about 3 percent in a choppy week to Aug. 23, as investors weighed burgeoning Chinese fuel exports, more Iraqi and Nigerian crude shipments and a rising U.S. oil rig count against the possibility of a production freeze deal by major producers.
Since then, Saudi has dashed hopes of a deal, when Energy Minister Khalid Al-Falih told Reuters that "we don't believe any significant intervention in the market is necessary."
OPEC members will meet on the sidelines of the International Energy Forum, which groups producers and consumers, in Algeria from Sept. 26-28.
On Friday, oil prices settled marginally higher after a choppy session as traders reacted to comments from Fed Chair Janet Yellen and reports of missile activity in Saudi Arabia.
Reporting by Devika Krishna Kumar
