Money Managers’ Bullish Tilt in Oil Market Ahead of 2025
Money managers are turning bullish on oil as algorithmic traders dump short positions, anticipating sanctions and inflation in a potential second Trump term. The Commodity Futures Trading Commission reported a 41% increase in long contracts for West Texas Intermediate, while short bets fell by 33%, marking the most optimistic stance since August. Analysts credit these shifts to Trump’s hawkish Iran policies and the inflation risk from his potential tariffs.
The market faces tight supply, with WTI and Brent trading in backwardation, indicating immediate supply constraints. Experts like Greg Sharenow note the favourable hedging environment despite geopolitical and inflationary risks. Meanwhile, challenges linger, including OPEC production restraint, China’s demand uncertainties, and US producer pressures. As the global market adjusts, volatility is likely to shape oil’s path forward. For further insights, read the full Bloomberg article.
Key Takeaways:
- Money Managers are favouring long oil positions due to bullish signals and expected geopolitical shifts.
- WTI and Brent markets show tight supply, boosting short-term profits for investors.
- Volatility is anticipated as market pressures from Trump’s policies and OPEC dynamics unfold.
Do you think geopolitical tensions will further impact oil prices in 2025? Share your thoughts below!