Behind Last Week's Oil Price Plunge: A Liquidation Of Longs

After Brent nearly reached $100 in late September amid rising fears about a massive oil deficit, the petroleum complex has sold off sharply, with the selloff accelerating last week in which WTI and Brent were down ~4.5% from last Friday’s close.

According to Goldman's futures trading desk, the move in spot prices appears to have been partially a capitulation of length that came into the market as concerns over near-term supply grew (OI fell alongside prices this week suggesting long liquidations).