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By Jack Wittels / Bloomberg News
LONDON
Petroleumworld 12 09 2021
Traders and investors are getting out of Europe’s main diesel contract at the fastest pace in years.
Total open interest in diesel contracts has plummeted by more than a third since the start of October — falling to its lowest since 2015, according to ICE Futures Europe data. It means the futures-market equivalent of almost 250 million barrels was closed.
The drop-off is part of the same story that helped drive a collapse in speculative interest in crude over the past few months, according to Ole Hansen, head of commodities strategy at Saxo Bank A/S. Diesel’s aggregate open interest has plunged by 40% since the end of June, a faster descent than the market’s main crude and oil-product contracts.
A falling diesel price drove the need to reduce exposure, mainly from those holding long positions, but also those who were short, Hansen said. Some traders need to cut exposure when volatility rises, as was the case after news of the omicron coronavirus variant emerged
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By Bloomberg News
bloomberg.com 12 09 2021
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