Hedge funds think oil prices are going in this direction

 
Jessica Morris
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They've also fully exited from the record short positions built up since October 2015 (Source: Getty)

When it comes to the future direction of oil prices, the only way is up, according to some of the world's top money managers.

They've amassed a near record number of bets on the price of the black stuff increasing, despite analysts warning the recent rally will peter out.

Brent crude, the global benchmark, has bounced over 40 per cent since falling to multi-year lows earlier this year.

By the close of business on 22 March, they held a net long position equivalent to almost 579m barrels in the three largest crude oil futures and options contracts, Reuters reported.

They've also fully exited from the record short positions built up since October 2015.

Optimists are looking through persistently high global oil inventories, instead paying attention to gas demand in the US and America, increasing optimism over a global freeze deal and signs US oil production is starting to tail off.

Similarly, recent outages in Nigeria and Kurdistan have demonstrated that the world has little room to manoeuvre in the event of a supply shock, with many oil producers operating at full capacity.

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