Oil Steadies After Fund Exit Triggers Fifth Weekly Decline

Prices were little changed, paring an earlier gain of 1.5 percent in New York. Speculators cut their net-long position in U.S. benchmark futures to the lowest in 10 months last week, and in North Sea Brent to the lowest since January 2016, exchange data showed. JPMorgan Chase & Co. cut its price forecasts as inventories remain plentiful.

Oil tumbled into a bear market last week on concerns that expanding global supply will counter the impact of output cuts from the Organization of Petroleum Exporting Countries and its partners including Russia. U.S. crude drillers added rigs for a 23rd straight week, the longest stretch in three decades, according to data release on Friday by Baker Hughes Inc.

“The lack of visible progress in tightening-up market conditions suggests markets are moving to discount OPEC actions as delivering tighter markets,” said David Martin, an analyst at JPMorgan in London.

WTI for August delivery climbed as much as 64 cents to $43.65 a barrel on the New York Mercantile Exchange, and was at $43.15 at 12:25 p.m. in London. Total volume traded was about 7 percent above the 100-day average. Prices are down about 10 percent this month.

Brent for August settlement gained as much as 70 cents, or 1.5 percent, to $46.24 a barrel on the London-based ICE Futures Europe exchange. Front-month prices lost 3.9 percent last week. The global benchmark crude traded at a premium of $2.46 to WTI.

Commodity Futures Trading Commission data on Friday showed money managers cut their net-bullish positions on WTI to the lowest in 10 months during the week ended June 20 and boosted wagers on falling prices. Data from ICE Futures Europe on Monday showed that speculators cut net-long positions in Brent by 54,162 contracts to 228,995, the lowest in 17 months.

“There is scope for oil markets to tighten over the rest of the year,” Kerry Craig, global markets strategist for JPMorgan Asset Management, said in a Bloomberg television interview. “As those prices stay weak, certainly some of those companies start adjusting their outlook for capex and investment and that slowly actually does start to bring rebalance into the market.”

Oil-market news:

Enterprise Products Partners LP resumed service on its Seaway Legacy crude pipeline Sunday after repairs to a leak discovered Thursday were completed, according to person familiar with matter. Enquest Plc has started pumping oil from the Kraken field in the U.K. North Sea.