Hedge funds are betting against oil with a conviction not seen in a decade. Short positions on ICE Brent crude futures and options have ballooned to $18 billion, the highest level in ten years, as money managers pile into bearish bets on the global benchmark.
The scale of the move is striking. Short positions quadrupled from 40 million barrels at the end of March 2026 to 140 million barrels by early June, the highest level recorded since mid-January.
What’s driving the bearish stampede
Two forces are converging to make oil traders deeply pessimistic: easing geopolitical tensions in the Middle East and expectations for increased global supply.
OPEC+ supply dynamics sit at the center of this shift. Investors are positioning for potential changes in the cartel’s production strategy, and the consensus view among money managers seems to be that more barrels are coming to market, not fewer.
