Hedge funds have turned more pessimistic on oil as prices flirted with $40 a barrel for the first time since August. "The speculators keep trying to pick the bottom and keep getting burned," Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts, said by phone.
Money managers' short bets in West Texas Intermediate crude surged 21 per cent in the week ended November 10, according to data from the Commodity Futures Trading Commission. The net-long position dropped 16 percent. The release of the figures was delayed because of Veterans Day on November 11. Oil inventories in developed countries have expanded to a record of almost three billion barrels because of massive supplies from both OPEC and non-OPEC producers, the International Energy Agency said in a report on November 13. WTI slipped to the lowest level since August before the CFTC release Monday. Thirty-nine oil tankers are waiting near Galveston, Texas, up from 30 in May, according to vessel-tracking data compiled by Bloomberg.
