Standard Chartered: Record CTA Long Bets Are Capping Oil's Upside
Strategic Petroleum Reserve Falls to Lowest Level Since 1982 Alex Kimani is a veteran finance writer, investor, engineer and researcher for Safehaven.com.
Oil prices rebounded from their recent slide on fears of U.S.-Iran escalation after attempts at diplomacy yielded mixed results, with speeches by leaders on both sides laced with threats and belligerence.Brent crudefor November delivery was up 1.70% to trade at $106.09 per barrel at 4:30 p.m.
ET on Monday, while the corresponding WTI crude contract was up 0.95% to change hands at $93.29 per barrel.In a defiant speech to the United Nations last Wednesday, resident Masoud Pezeshkian blamed the U.S.
for starting the war and stoking global instability,vowingto never bend the knee.
Pezeshkian said his country is open to dialogue, but set seven preconditions before returning to talks, including a release of frozen funds and an end of the war on all fronts.
The Iranian leader was speaking a day after U.S.
President Donald Trump said he was weighing whether to ‘annihilate’ Iran, but also reiterated his earlier position of a possible deal being signed after the midterms.
An adviser to Iran’s supreme leader Mojtaba Khamenei later warned that Iran may expand the war to the Indian Ocean if it’s attacked again.
And now, oil and commodity experts at Standard Chartered have reported that the oil price rally is currently constrained by ultra-bullish positioning by money managers, and the rally is only likely to regain momentum if the physical markets are impacted more deeply by the war.
Commodity Trading Advisors (CTAs), the trend-following funds that trade off algorithmic models, are positioned at maximum long across Brent, WTI and the major refined product markets, a configuration StanChart says it has recorded only a handful of times in the past decade.
Strategic Petroleum Reserve Falls to Lowest Level Since 1982 The systematic bid that pushed crude higher has little room left to run, though.
Further gains now depend on discretionary or physical buyers stepping in, not additional momentum buying.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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