Traders Flee Long-Term Oil Bets Amid Ongoing Wars

Morgan Stanley's oil traders are taking a more cautious approach to risk as the wars in Iran and Ukraine continue, said Brendan Ross, Co-Head Global Oil Trading at Morgan Stanley.

With high uncertainty about how these conflicts will unfold, many traders have shifted their focus from longer-dated futures contracts to near-dated ones within a three to six-month period.

This change is driven by the desire to avoid being caught on the wrong side of unexpected price movements, according to Ross.

The shift has led to a decrease in liquidity for longer-term contracts and speculators are piling up in near-dated futures instead.