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▲ Strait of Hormuz, US, Iran, Brent crude, rising oil prices/AI-generated image
Evidence has emerged that large speculative forces and investors in physical crude oil-linked tokens simultaneously engaged in low-price buying before international oil prices sharply rebounded from $68 to $74.
According to crypto media outlet BeInCrypto on July 9 (local time), West Texas Intermediate (WTI) crude jumped from approximately $68 to $74 after the Iranian ceasefire wavered and an oil tanker attack occurred near the Strait of Hormuz. US strikes on Iran and the resumption of sanctions also reignited concerns about crude oil supply.
Reports on trader positions from US regulators show that large speculative forces increased long contracts by 1,722 and decreased short contracts by 1,020 while crude oil prices were falling towards $68 until June 30. Net long positions exceeded 23,700 contracts, and open interest also increased by 3,568 contracts to 222,308 contracts. This indicates that new funds moved towards an upward trend despite the price decline.
Individual investors moved in the opposite direction. Small-scale investors added 5,490 short contracts but only increased long contracts by 1,053. Subsequently, as international oil prices sharply rebounded, their bets on a decline faced a headwind.
Similar signals appeared in the on-chain market. The number of holders of WTIC, which is based on one barrel of physically redeemable crude oil, increased tenfold from 27 to 267 in just five days in June. On July 3, the largest single transfer in months, valued at $367,000, also occurred. Although the total value of WTIC is only $79,000, it showed buying activity during the price decline phase, simultaneously with large speculative forces in the futures market.
BeInCrypto warned that WTIC is small in scale, a single wallet holds most of the supply, and it is not subject to regulation. It analyzed that if attacks near the Strait of Hormuz increase, international oil prices could approach $100, reflecting a war risk premium, but if the ceasefire is maintained for a long period, prices could fall again.
[Key Article Summary]
-Large speculative forces increased long contracts by 1,722 and decreased short contracts by 1,020 when international oil prices were falling.
-WTIC holders increased tenfold from 27 to 267 in 5 days, and a transfer worth $367,000 also occurred.
-WTI rebounded from approximately $68 to $74 amid the breakdown of the Iranian ceasefire and tensions in the Strait of Hormuz.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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