Not so long ago, oil prices were firmly in the triple digits, with investors stressing over their further prospects and inflationary effects.
Yet, as of the start of Q3, the benchmark crude has slipped back below the levels before the outbreak of the Iran war.
Net speculative length, according to Eric Nuttall, a Senior PM at Ninepoint Partners, has collapsed from 511 million barrels to 162 million — a full retreat to the kind of positioning last seen before the latest supply scare.
On the surface, such numbers would look bearish, but before examining the physical inventories that seem to be evaporating on a weekly basis.
"We've gone from a 177-million-barrel surplus to a 141-million-barrel deficit relative to the 5-year average," Nuttall said in a recent review, while explaining that floating storage has been absorbed too.
