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Speculators are once again fleeing the oil market, setting the stage for more extreme price swings.
Money managers dumped their net-bullish oil holdings by 19%, the biggest drop in six weeks. The positions are now at the lowest seasonal level in more than a decade.
The exodus comes amid another crash for oil, driven by concerns over the economy. West Texas Intermediate futures have tumbled for three straight weeks, even briefly plunging to the lowest level since late 2021.
With investors rushing for the exit, it’s drying up liquidity and leaving the markets largely in the hands of algorithm or momentum-based traders — a scenario that often creates even more volatility, said Michael Tran, managing director at RBC Capital Markets LLC.
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