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Hedge funds boosted bullish bets as EU gas prices hit new 2024 highs

Hedge funds seem to be hell-bent on leveraging geopolitical events to pump European natural gas prices higher.

Last week saw another significant increase in bullish bets being taken by speculative traders on the Dutch Title Transfer Facility (TTF) — Europe’s benchmark natural gas trading hub.

Speculators boosted their net long positions on TTF by approximately €1.5 billion, according to calculations by Energy Flux. The increase extended overall net bullish position of hedge funds to more than €8 billion.

The move coincided with a fresh bump in the price of gas traded on the TTF, as covered at length in Monday’s EU LNG Chart Deck.

Speculative capital keeps pouring into long positions in European gas futures, accelerating bullish price momentum predicated on fears of possible disruption to (what little remains of) Russian gas transits into the EU via Ukraine.

But they are only fears, and gas flows through Ukraine continue uninterrupted (at the time of writing).

This bonus post provides a short(ish) update now that data has been published on hedge fund positioning during the tumultuous events of last week.

The data confirms an ongoing correlation between speculative capital movements and price action on TTF, shedding new light on the contracts being traded on the forward curve.

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