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America's Stubborn Oil-Supply Glut Catches Funds Off Guard 

June 12, 2017

Jessica Summers, Bloomberg

"Crude markets are taking oil optimists by surprise yet again.

Hedge funds boosted bets on a rally just before West Texas Intermediate prices tanked from a report showing surging American stockpiles. Wagers rose 7.3 percent to the highest since April in the week through June 6, U.S. Commodity Futures Trading Commission data show. The next day, futures fell the most since March and are lingering near this year’s lows.

“The last thing the market needed to see was that inventories in the U.S. went up, when they are supposed to be going down seasonally,” Tamar Essner, an energy analyst at Nasdaq Inc. in New York, said by telephone. The report “shows that there are some bulls that are starting to get more interested in the market, but I imagine that when we get the CFTC data next week to reflect the Wednesday selloff, we’ll see a bit of a reversal.”


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