Author: Zhitong Finance Ma Huomin

Investors are selling oil at their fastest pace in more than six months.

Zhitong Financial APP has learned that investors are selling oil at their fastest pace in more than six months because of signs that Israel and Iran have chosen not to escalate the conflict, causing crude oil prices to stagnate before hitting $100 a barrel.

In the seven days ended April 23, the hedge fund and itsLiteroticapokerHis fund manager sold the equivalent of 95 million barrels of the six most important oil futures and options contracts.

According to reports submitted to ICE and the Commodity Futures Trading Commission, this is the fastest selling rate since October 2023, with total sales reaching 1 in two weeks.Literoticapoker.1.9 billion barrels.

As the war risk premium evaporated, the total position fell to 566 million barrels from 685 million barrels on April 9th.

In recent weeks, there has been a substantial sell-off in most markets, particularly crude oil and European diesel, which are most affected by the conflict in the Middle East.

At the beginning of this month, at the height of the confrontation between Iran and Israel, the total position in crude oil was cut from 522 million barrels to 453 million barrels.

The ratio of long positions to short positions even fell sharply to 3.51, down from a recent high of 4.97 at the end of March.

Fund managers have concluded that oil production facilities around the Persian Gulf or tanker routes through the Strait of Hormuz are not currently threatened.

Saudi Arabia and its OPEC+ allies continue to limit oil production, but are expected to gradually increase production in the second half of this year.

In 2024, growth in oil production from non-OPEC countries from the United States, Canada, Brazil and Guyana is likely to cover most of the increase in consumption.

Global inventories remain close to the long-term seasonal average, while Saudi Arabia and other Middle East OPEC members have spare capacity of more than 4 million barrels a day.

American gasoline

Fund managers remain divided on the outlook for US gasoline prices in an election year.

As of April 23, the fund still held a net long position of 73 million barrels, just below its recent high of 85 million barrels on April 9.

But the number of short positions has more than tripled from a recent low of less than 9 million barrels on March 12 to 27 million barrels.

The ratio of long position to short position is 3.72 / 1, down from 8.73 / 1 six weeks ago.

Gasoline consumption in the United States remains active, supported by steady growth in employment and income, while refinery fuel production is at high risk from the hurricane season.

But under US pressure, Ukrainian drone strikes on Russian refineries have been reduced, reducing the threat to global gasoline supplies.

Us gasoline inventories are only slightly below the average for the same period in previous years and the gap has stabilized after BP.US 's Whiting refinery in Indiana resumed operations.

Some hedge funds seem to believe that prices are rising too fast and trading is too crowded, creating greater downside risks.

American natural gas

Fund pessimism about the outlook for US natural gas prices eased in the week to April 23, despite a growing seasonal inventory glut.

Hedge funds and other fund managers bought the equivalent of 382 billion cubic feet of two major natural gas futures and options contracts.

This is the fastest buying rate since major natural gas producers announced cuts in drilling and production in early March.

The total net short position was only 102 billion cubic feet, compared with 483 billion cubic feet the previous week and 167.5 billion cubic feet two months ago.

The decline in natural gas drilling will lead to a slowdown in production growth by the end of the year, and as El Ni ñ o recedes, the winter of 2024 / 25 is likely to be colder than the warm winter of 2023 / 24.

In terms of positions and fundamentals, the balance of price risk has shifted upwards in recent weeks.