Oil Has Short-Sellers On the Run, Helping Fuel New Year's Rally - Bloomberg

Oil Has Short-Sellers On the Run, Helping Fuel New Year's Rally - Bloomberg:

Oil’s rally is driving doubters out of the market, with hedge funds abandoning more than half of their short-selling bets in just four weeks.

With Brent crude enjoying its best month in almost three years, money managers slashed bearish bets on the global benchmark price by another 27 percent in the week ended Jan. 29, data showed Friday. The flight of the pessimists continued to be a dominant factor in oil’s rebound, with bets on a price increase rising by only 4.5 percent.

“When you see the shorts throwing in the towel like this, you know that’s been a big part of the lift we’ve seen," said Bill O’Grady, chief market strategist at Confluence Investment Management in St. Louis. “We’ve clearly covered a lot of the shorts. Now you’re going to need some more bullish information to attract the long money."