What's Moving the Oil Markets?

What's Moving the Oil Markets?

•Front-month IPE Brent futures were at a six-week low Monday, as continued cross-commodity selling by investors on a resurgence in the US dollar, caused crude futures to fall once again, traders said. At 0953 GMT, the July IPE Brent futures contract was changing hands at $67.94/barrel, down 74 cents, a level not seen since April 10.

•The recent fall has been due to investors, such as hedge funds, liquidating heir long positions, market sources said. Non-commercials liquidated 8,879 contracts of crude futures and options as of May 16, leaving them long 100,483 lots, according to data released by the CFTC. Non-commercials predominantly liquidated their position in the futures market and the selling sent prices back below $70/barrel, according to the Commitments of Traders report.

•One of the main reasons for the recent weakening of IPE Brent has been due to the strengthening of the US dollar. On Monday in early trading, it extended its recent strengthening, weighing on the prices of dollar-denominated commodities including oil.

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