By John Kemp

LONDON, Oct 5 (Reuters)Hedge funds and other money managers resumed selling oil last week as concerns about the health of the global economy re-emerged and the previous week’s short-covering rally lost momentum.

Hedge funds sold the equivalent of 29 million barrels in the six most important petroleum futures and options contracts, largely reversing purchases of 40 million barrels the week before.

Portfolio managers have sold oil in five of the last six weeks, reducing their total position by 227 million barrels since the middle of August (https://tmsnrt.rs/3d3KNJA).

In the latest week, funds sold NYMEX and ICE WTI (-24 million barrels), Brent (-7 million) and European gasoil (-3 million) but were small buyers of U.S. diesel (+3 million) and U.S. gasoline (+2 million).

Across the six contracts, funds sold 11 million barrels of existing bullish long positions and established 18 million barrels of new bearish short positions.

The race to cover short positions and an associated mini price rally in the week ending Sept. 22 proved to be an aberration, with the shorting trend resuming in the week to Sept. 29.

EMPTY THREAT?

Portfolio managers disregarded threats from Saudi Arabia’s oil minister to squeeze short sellers, apparently unconvinced the kingdom will back up its aggressive rhetoric by cuts in production.

The prospect the resurgent epidemic will disrupt most of the major economies and international travel for at least another six months is weighing heavily on prices.

Oil refiners continue to restrain crude purchases and processing to work down excess stocks of distillates built up during the second quarter.

Fund positions have returned to some of their most bearish in the last three years, records published by regulators and exchanges show.

The ratio of long to short positions is close to its lowest since 2017 and

By John Kemp

LONDON, Sept 28 (Reuters)Hedge funds trimmed bearish positions in crude oil last week after Saudi Arabia threatened to punish short sellers and on signs that prices had found a floor after recent weakness.

Hedge funds and other money managers purchased the equivalent of 40 million barrels in the six most important petroleum futures and options contracts in the week to Sept. 22.

Purchases occurred at the fastest rate since late April, according to position records published by ICE Futures Europe and the U.S. Commodity Futures Trading Commission.

But buying was concentrated in crude rather than refined products, and involved buying back previous short positions rather than opening new long ones.

Portfolio managers purchased mainly Brent (+23 million barrels) and NYMEX and ICE WTI (+18 million), with smaller purchases in U.S. gasoline (+2 million) and European gasoil (+3 million) and sales of U.S. diesel (-5 million).

On the crude side, funds repurchased 37 million barrels of previous short sales while opening just 3 million barrels of new bullish long positions.

Across all six petroleum contracts, total short positions fell to 340 million barrels, from a two-year high of 379 million the week before, but still up from 223 million a month ago (https://tmsnrt.rs/339TpLq).

The pattern is consistent with funds becoming less bearish rather than more bullish, de-risking their portfolios rather than adding more price exposure.

It came after Saudi Arabia’s oil minister threatened to leave short sellers “ouching” a few days earlier, and amid signs oil prices were stabilising after the recent sell-off, despite a drumbeat of negative economic news.

Calendar spreads for both physical Brent and Brent futures have also rebounded modestly after previous weakness, indicating traders see a more balanced market in the next few months.

Before last week’s short-covering, the market was