epa06360096 Alexander Novak (L), Russia's energy minister, Khalid Al-Falih (C), President of the Opec conference and Saudi Arabia's energy and Mohammed Barkindo (R), Opec Secretary General arrive for news conference at the headquarters of the Organization of Petroleum Exporting Countries in Vienna, Austria, 30 November 2017.  EPA/LISI NIESNER
Alexander Novak, Russia's energy minister, Khalid Al-Falih, Saudi Arabia's energy minister and Opec secretary general Mohammed Barkindo. Lisi Niesner / EPA

Hedge funds signal trust in Opec as short-sellers retreat



Hedge funds are giving Saudi Arabia and Russia a big vote of confidence.

As the two oil powerhouses pushed for the extension of supply curbs ahead of Thursday’s Opec meeting, money managers shifted their stance on West Texas Intermediate crude to the most bullish since February. That’s largely due to a strong decline in short-selling. Bets on rising Brent crude also increased as short positions slumped.

“There was definitely a consensus that we were going to see a six- to nine-month extension, so to be short in front of that obviously would not be a good positioning for hedge funds,” said Nick Holmes, an analyst at Tortoise Capital Advisors, which manages US$16 billion in energy-related assets. “There was definitely some bullishness that we were going to see a pretty good result out of Opec, which we did.”

Opec and partners including Russia agreed on Thursday in Vienna to continue with their output cutbacks until the end of next year. Russia’s Energy Minister Alexander Novak said after the meeting that the deal was extended to show “long-term commitment” and it provides the opportunity for changes next year if needed.

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Hedge funds raised their WTI net-long position - the difference between bets on a price increase and wagers on a drop - by 15 per cent to 396,484 futures and options in the week ended November 28, according to data from the US Commodity Futures Trading Commission. Shorts dropped by 39 per cent, while longs advanced 6.5 per cent.

The Brent net-long position rose by 2.2 per cent to 537,979 contracts, according to data from ICE Futures Europe. Longs increased by 1.1 per cent, while shorts declined 9.1 per cent to the lowest level since February.

In the fuel market, money managers reduced their net-long position on benchmark US gasoline by 3.1 per cent. Meanwhile, the net-bullish position on diesel climbed 3.2 per cent to a fresh record.

WTI and Brent are trading near two-year highs after surging more than 20 per cent over the past three months as Saudi Arabia and Russia gradually built momentum for their decision to prolong supply cuts. At the same time, stockpiles in the US have dropped significantly from their March peak.

That surge in prices could prompt hedge funds to take advantage of high prices to profit from selling, according to Mark Watkins, a Park City, Utah-based regional investment manager at US Bank Wealth Management, which oversees $142bn in assets.

“But longer-term, the re-balancing trade is starting to work, so if they are in it for that longer-term play, keeping a long position would make sense,” Watkins said in a phone interview.

The question mark is the US shale response. UBS Group warned that any further rise in oil prices would likely ignite US shale output, while Barclays said that Opec’s extension might boost nationwide production by another 1 million barrels a day by the end of next year. Yet Goldman Sachs Group Inc. said the duration of Opec’s cuts helps to lessen the risk of a large increase in production from high available spare capacity.

Going forward, if “inventories are dropping down and you’re not seeing a huge supply-side response from shale producers, then I think we’re going to increase open interest on the longs,” said Bart Melek, head of global commodity strategy at TD Securities in Toronto.

Results:

6.30pm: Maiden Dh 165,000 1,400m.
Winner: Walking Thunder, Connor Beasley (jockey), Ahmad bin Harmash (trainer).

7.05pm: Handicap (rated 72-87) Dh 165,000 1,600m.
Winner: Syncopation, George Buckell, Doug Watson.

7.40pm: Maiden Dh 165,000 1,400m.
Winner: Big Brown Bear, Pat Dobbs, Doug Watson.

8.15pm: Handicap (75-95) Dh 190,000 1,200m.
Winner: Stunned, Pat Dobbs, Doug Watson.

8.50pm: Handicap (85-105) Dh 210,000 2,000m.
Winner: New Trails, Connor Beasley, Ahmad bin Harmash.

9.25pm: Handicap (75-95) Dh 190,000 1,600m.
Winner: Pillar Of Society, Pat Dobbs, Doug Watson.

The Bloomberg Billionaire Index in full

1 Jeff Bezos $140 billion
2 Bill Gates $98.3 billion
3 Bernard Arnault $83.1 billion
4 Warren Buffett $83 billion
5 Amancio Ortega $67.9 billion
6 Mark Zuckerberg $67.3 billion
7 Larry Page $56.8 billion
8 Larry Ellison $56.1 billion
9 Sergey Brin $55.2 billion
10 Carlos Slim $55.2 billion

Sunday:
GP3 race: 12:10pm
Formula 2 race: 1:35pm
Formula 1 race: 5:10pm
Performance: Guns N' Roses

Coming soon

Torno Subito by Massimo Bottura

When the W Dubai – The Palm hotel opens at the end of this year, one of the highlights will be Massimo Bottura’s new restaurant, Torno Subito, which promises “to take guests on a journey back to 1960s Italy”. It is the three Michelinstarred chef’s first venture in Dubai and should be every bit as ambitious as you would expect from the man whose restaurant in Italy, Osteria Francescana, was crowned number one in this year’s list of the World’s 50 Best Restaurants.

Akira Back Dubai

Another exciting opening at the W Dubai – The Palm hotel is South Korean chef Akira Back’s new restaurant, which will continue to showcase some of the finest Asian food in the world. Back, whose Seoul restaurant, Dosa, won a Michelin star last year, describes his menu as,  “an innovative Japanese cuisine prepared with a Korean accent”.

Dinner by Heston Blumenthal

The highly experimental chef, whose dishes are as much about spectacle as taste, opens his first restaurant in Dubai next year. Housed at The Royal Atlantis Resort & Residences, Dinner by Heston Blumenthal will feature contemporary twists on recipes that date back to the 1300s, including goats’ milk cheesecake. Always remember with a Blumenthal dish: nothing is quite as it seems. 

The Specs

Engine: 1.6-litre 4-cylinder petrol
Power: 118hp
Torque: 149Nm
Transmission: Six-speed automatic
Price: From Dh61,500
On sale: Now

RECORD BREAKER

Youngest debutant for Barcelona: 15 years and 290 days v Real Betis
Youngest La Liga starter in the 21st century: 16 years and 38 days v Cadiz
Youngest player to register an assist in La Liga in the 21st century: 16 years and 45 days v Villarreal
Youngest debutant for Spain: 16 years and 57 days v Georgia
Youngest goalscorer for Spain: 16 years and 57 days
Youngest player to score in a Euro qualifier: 16 years and 57 days

ASIAN RUGBY CHAMPIONSHIP 2024

Results
Hong Kong 52-5 UAE
South Korea 55-5 Malaysia
Malaysia 6-70 Hong Kong
UAE 36-32 South Korea

Fixtures
Friday, June 21, 7.30pm kick-off: UAE v Malaysia
At The Sevens, Dubai (admission is free).
Saturday: Hong Kong v South Korea

Fines for littering

In Dubai:

Dh200 for littering or spitting in the Dubai Metro

Dh500 for throwing cigarette butts or chewing gum on the floor, or littering from a vehicle. 
Dh1,000 for littering on a beach, spitting in public places, throwing a cigarette butt from a vehicle

In Sharjah and other emirates
Dh500 for littering - including cigarette butts and chewing gum - in public places and beaches in Sharjah
Dh2,000 for littering in Sharjah deserts
Dh500 for littering from a vehicle in Ras Al Khaimah
Dh1,000 for littering from a car in Abu Dhabi
Dh1,000 to Dh100,000 for dumping waste in residential or public areas in Al Ain
Dh10,000 for littering at Ajman's beaches 

MATCH RESULT

Al Jazira 3 Persepolis 2
Jazira:
Mabkhout (52'), Romarinho (77'), Al Hammadi (90'+6)
Persepolis: Alipour (42'), Mensha (84')

Five expert hiking tips
  • Always check the weather forecast before setting off
  • Make sure you have plenty of water
  • Set off early to avoid sudden weather changes in the afternoon
  • Wear appropriate clothing and footwear
  • Take your litter home with you

Brighton 1
Gross (50' pen)

Tottenham 1
Kane (48)

UAE Falcons

Carly Lewis (captain), Emily Fensome, Kelly Loy, Isabel Affley, Jessica Cronin, Jemma Eley, Jenna Guy, Kate Lewis, Megan Polley, Charlie Preston, Becki Quigley and Sophie Siffre. Deb Jones and Lucia Sdao – coach and assistant coach.

BACK TO ALEXANDRIA

Director: Tamer Ruggli

Starring: Nadine Labaki, Fanny Ardant

Rating: 3.5/5

Russia's Muslim Heartlands

Dominic Rubin, Oxford

'Midnights'

Artist: Taylor Swift

Label: Republic Records

Rating: 4/5

How to become a Boglehead

Bogleheads follow simple investing philosophies to build their wealth and live better lives. Just follow these steps.

•   Spend less than you earn and save the rest. You can do this by earning more, or being frugal. Better still, do both.

•   Invest early, invest often. It takes time to grow your wealth on the stock market. The sooner you begin, the better.

•   Choose the right level of risk. Don't gamble by investing in get-rich-quick schemes or high-risk plays. Don't play it too safe, either, by leaving long-term savings in cash.

•   Diversify. Do not keep all your eggs in one basket. Spread your money between different companies, sectors, markets and asset classes such as bonds and property.

•   Keep charges low. The biggest drag on investment performance is all the charges you pay to advisers and active fund managers.

•   Keep it simple. Complexity is your enemy. You can build a balanced, diversified portfolio with just a handful of ETFs.

•   Forget timing the market. Nobody knows where share prices will go next, so don't try to second-guess them.

•   Stick with it. Do not sell up in a market crash. Use the opportunity to invest more at the lower price.


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