Over the past week, the Feb’25 Brent futures contract initially saw weakness, trading from an intraday high of $72.85/bbl on 05 Dec down to $71.00/bbl on 06 Dec. However, the Feb’25 contract made a recovery thereafter, rising to $73.90/bbl at the time of writing on 12 Dec. Crude oil prices found support as OPEC+ extended production cuts until April 2025, with the unwinding of cuts delayed by a year until the end of 2026. Further aiding bullish sentiment, China announced a “moderately loose” monetary policy for 2025, the first easing of its stance in 14 years. In addition, China’s crude oil imports rose 14.3% y/y in November, marking the first yearly increase since April 2024. Despite this recent strength, Onyx’s weekly CFTC COT predictor anticipates speculative players to be risk-off in Brent, while seeing a small increase in their short positions for the week ending 10 Dec. Managed-by-money long positions are expected to decrease by almost 7.2mb, compared to last week’s increase of 21.9mb, while adding 2.7mb to their short positions. This may be a reflection of money managers unwinding their long positions as we approach the end of the year. Meanwhile, prod/merc players are projected to be risk-on, increasing both long and short positions by 10mb and 6.5mb, respectively.
