(Bloomberg) -- Hedge funds fled bullish bets on benchmark Brent crude as easing tensions in the Middle East and a clouded fundamental outlook weigh on prices.
Money managers reduced their Brent long-only positions by 53,341 to 341,835 over the week ending May 7, the lowest in about eight weeks, according to the according to figures from ICE Futures Europe. Additionally, hedge funds decreased their bullish gasoline bets to the lowest in six months as demand for the motor fuel has remained lackluster.
Prices fell below $80 on May 1 and have hovered around seven-week lows for much of the week. Crude’s geopolitical risk premium has largely vanished after Hamas expressed openness to a potential cease-fire, and US stockpiles grew last week.
Crude market technicals provided some support against the selloff with relative strength indexes showing that crude was oversold. Saudi Arabia also hiked oil prices and traders largely expect OPEC to continue with supply cuts.
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