[LONDON] Speculators last week made the biggest cut in more than two years to bets that oil prices will rise, InterContinental Exchange (ICE) data showed, with little sign of producers agreeing an output freeze.
Members of the Organization of the Petroleum Exporting Countries (Opec) are meeting informally on the sidelines of this week's International Energy Forum in Algeria, where they will discuss a possible deal to limit output.
However, oil prices fell nearly 5 per cent last week as Saudi Arabia and rival Iran seemed to make little progress in achieving a preliminary agreement.
Money managers cut their net long holdings of Brent crude futures and options by 47,071 contracts to 312,102 lots in the week to Sept 20, an ICE report showed on Monday.
This was the biggest weekly cut to the net long position on ICE since mid-July 2014.
Data from the US Commodity Futures Trading Commission on Friday showed that hedge fund managers cut their net long position in US crude oil to its lowest in a month, having made record weekly additions to their short positions.
"We have not seen an exodus, so much as a repositioning by investors taking their chips off the table, with some profit-taking," said Commerzbank commodities strategist Eugen Weinberg.
"In general, the recent decrease in the net long in WTI and Brent is just pointing to the fact that the market is getting concerned about continued oversupply and inaction by Opec." Market participants are sceptical a deal will be reached at the informal Sept 26-28 Opec meeting.
Brent crude speculators increased their short positions by 15,442 lots to 70,171 contracts last week.
Investors in gasoil futures cut their net long position by 12,207 lots to 14,088 contracts in the same week. The front-month gasoil futures contract ended last week with a 3.2 per cent gain at US$425.50 a tonne.