Hedge funds slashed their bullish positions on Brent crude to the lowest level since October as OPEC+ announced a significant production increase, sparking renewed fears of oversupply in global energy markets, according to a report by Bloomberg.

The report cites data from ICE Futures Europe as showing that net-long positions in Brent crude futures and options fell by over 12,000 contracts to 97,558 in the week ending 6 May, marking the weakest sentiment toward Brent among speculative traders in nearly six months. Meanwhile, short positions in West Texas Intermediate (WTI) crude saw their biggest weekly jump since March, based on figures from the US Commodity Futures Trading Commission.

The shift in positioning follows OPEC+’s decision to add an additional 411,000 barrels per day to the market starting in June – a move that blindsided many investors and prompted a wave of downward price revisions from major Wall Street players, including Goldman Sachs and Morgan Stanley. The timing of the announcement, moved forward by two days and ratified on a Saturday, further unsettled markets, pushing oil prices to their lowest levels in four years.

The Saudi-led strategy, which appears to prioritise market share over price stability, has left hedge funds recalibrating their outlook. Brent's selloff has forced a reevaluation of long-energy exposure across macro and commodity-focused portfolios, especially as volatility around OPEC+ policy signals grows.

Oil prices have since recovered modestly, buoyed by expectations of a slowdown in US domestic output and optimism following a newly signed US-UK trade agreement—one of the first to materialise under Trump’s second-term trade agenda.