Hedge funds sharply reduced bearish bets on Brent crude in the final week of October, as new US sanctions on Russia’s largest oil companies triggered a record unwind of short positions, according to a report by Bloomberg citing data from ICE Futures Europe.
The ICE figures reveal that money managers cut short-only positions by 62,078 lots to 135,790, marking the largest weekly decline on record. The shift follows Washington’s decision to blacklist Rosneft and Lukoil, raising concerns over potential disruptions to Russian exports just as markets had been adjusting to oversupply conditions.
The move has injected renewed bullish momentum into oil markets, with traders watching India and China – key buyers of Russian crude – for signs of how sanctions might reshape global trade flows.
The sanctions arrive amid an already complex backdrop of ample global supply and moderating demand growth, factors that had driven bearish sentiment in recent months. Analysts say positioning data suggest hedge funds are now reassessing downside exposure in anticipation of near-term price volatility and geopolitical risk repricing.
