Global commodity markets: Commodity open interest fell 3% as energy prices and investor positioning weakened

Overview

This weekly global commodities positioning report tracks futures open interest, investor positioning, contract flows and momentum signals across energy, environmental markets, metals and agriculture. Its central finding is a broad weekly retreat in open interest and positioning, led by energy-market price weakness and investor outflows, alongside differentiated trends in copper, precious metals and agricultural markets.

Core views

JPMorgan estimates that open interest across tracked global commodity markets fell 3% week on week, or $54 billion, to $2 trillion in the week ending 25 September. The decline was predominantly an energy-market move: energy open interest fell $47 billion, reflecting $24 billion of net contract-based outflows alongside significant oil-and-gas price declines. Aggregate net investor positioning fell 1% week on week, or $2 billion, to $266 billion. The report notes that its 28 September QDS projections point to a further $19 billion decline in commodity positioning, led by gold ($9.3 billion), grains ($5.7 billion) and petroleum products ($1.6 billion). Despite recent market volatility, the institution's economists expect a cyclical uplift and strong growth in the second half of 2026 as PMIs improve beyond technology, while higher rates have not yet caused markets or central banks to price growth restrictions. Energy was the principal source of the weekly reversal. Estimated energy open interest declined 5% week on week, or $47 billion, to $928 billion. In crude oil and petroleum products, $20 billion of net contract-based outflows combined with lower prices to reduce open interest. Net energy length declined $4.4 billion: investors reduced positions in Dubai crude by $6 billion, WTI by $1 billion and ICE Brent by $0.7 billion, partly offset by a $3.8 billion increase in petroleum-products positioning. The report also highlights record-high US diesel prices and the lowest September diesel inventories on record. It argues that a 30-day US diesel export ban combined with a Jones Act waiver could initially rebuild inventories and lower domestic diesel prices and cracks, but would become more economically difficult after inventories normalize because export restrictions could ultimately affect US refining capacity. Natural-gas open interest also fell 5% to $235 billion, driven by price declines in European and Asian benchmarks and $3.4 billion of net contract-based outflows; TTF fell 9.4% week on week. The report observes increased use of “dark” mode by QatarEnergy LNG tankers transiting the Strait of Hormuz or idling in the Gulf. At least four dark transits occurred during the week, bringing September exits to seven, all bound for or delivered to Asia. Although this was an improvement from zero transits in August, activity remained below normal. JPMorgan therefore continues to see tight fundamentals for the coming winter, elevated prices and high volatility while transit conditions lack greater clarity. Across metals, precious-metals open interest declined 3% week on week, or $10.5 billion, to $303 billion, a six-week low. The sector experienced $3.2 billion of net contract-based outflows across trader types, principally $3 billion from gold, while net managed-money positioning in COMEX gold futures fell by 5,700 contracts to 127,000 contracts net long. In contrast, base-metals open interest increased 1%, or $3.2 billion, to $242 billion, with $2 billion of net inflows, mainly $0.7 billion into LME nickel. Net base-metals length increased $5.4 billion, led by copper at $5 billion. The report says its principal metals focus remains copper, where supply faces a three-part risk from diesel availability in South America, El Niño-related weather and a potential Chilean strike. It views nickel NPI cutbacks as manageable because of inventory buffers and reduced Chinese demand, with the rainy season beginning in November potentially easing current water stress. For copper, it identifies the most acute El Niño supply risks as drier conditions in Southeast Asia and Zambia and wetter conditions in Chile and Peru. Environmental-market open interest rose 2% week on week, or $1.4 billion, to $89 billion, supported by $2.3 billion of net contract inflows, primarily into EU Allowances, though lower EUA prices partly offset the increase. Investment funds reduced their net EUA long position by 325 lots week on week to 33,783 lots as of 18 September. Agricultural-market open interest was broadly unchanged at $427 billion: higher softs and livestock prices were largely offset by $0.9 billion of net outflows, chiefly from grains and oilseeds. The report says the US-China Summit produced little new for agriculture, but the new US and China Board of Trade agreed to substantially reduce reciprocal tariffs on $30 billion of goods, including US agricultural products other than soybeans, to most-favoured-nation rates around 1%. JPMorgan sees this as improving the competitiveness of US-origin agricultural products for private Chinese buyers and opening the economics for China's May commitment to purchase $17 billion of US agricultural products excluding soybeans in 2026, 2027 and 2028; the 2026 commitment is pro-rated to about $9 billion. Price momentum weakened across energy and metals and was mixed in agriculture. During the week, the short-term momentum signal for NYMEX natural gas switched to buy, while the corresponding signals for TTF, silver and platinum switched to sell. The report explains that momentum z-scores crossing zero can trigger trend-following models to reverse between buy and sell, potentially increasing volatility where CTA participation is large. At extreme positive or negative momentum readings, the framework issues neutral signals intended to slow position building or encourage profit-taking.

Analysis framework

The report aggregates exchange data and JPMorgan QDS projections across tracked commodity futures. It estimates open interest by multiplying outstanding contracts by contract size and the latest price, and calculates weekly flows from changes in outstanding contracts using the prior week's price. It then separates price effects from contract-flow effects, compares investor positioning across sectors and exchanges, and supplements these measures with short- and long-term momentum signals.

Methodology notes

• Industry AnalysisVolume-price decomposition

  Open-interest and flow decomposition

  The report separates changes in estimated open interest into the effects of commodity-price moves and changes in outstanding futures contracts, allowing it to distinguish valuation changes from investor flows.

• Quantitative, Factor, and Portfolio Theory

  Momentum z-score and trend-following signal framework

  The report uses optimized lookback periods, momentum z-scores, a mean-reversion overlay and neutral filters to generate short- and long-term commodity trading signals and assess potential CTA-related volatility.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Energy commodities

  Largest contributor to the global decline in open interest and positioning.

  Strengths

  Tight natural-gas fundamentals for the upcoming winter.

  Weaknesses

  Oil and gas prices declined significantly, accompanied by large contract-based outflows.

  Comparison

  Energy open interest fell 5%, versus a 1% increase in base metals and broadly stable agriculture.

  Risks

  Unclear LNG transit conditions, elevated natural-gas prices and high volatility; diesel export restrictions could affect US refining capacity.

• Copper

  Primary focus within base metals and main driver of increased base-metal net length.

  Strengths

  Copper accounted for $5 billion of the $5.4 billion increase in base-metals net length.

  Comparison

  Base-metals positioning strengthened while precious-metals positioning declined.

  Risks

  Diesel availability in South America, El Niño weather risks and a potential Chilean strike.

• Gold

  Main source of precious-metals outflows and projected commodity-positioning decline.

  Weaknesses

  Gold accounted for about $3 billion of weekly precious-metals contract outflows.

  Comparison

  COMEX gold managed-money net length fell 5,700 contracts to 127,000 contracts net long.

  Risks

  JPMorgan's latest projections indicate a further $9.3 billion decline in gold positioning.

• Agricultural commodities

  Open interest remained broadly stable despite contract outflows.

  Strengths

  Lower prospective tariffs improve the competitiveness of US-origin agricultural products for Chinese private buyers.

  Weaknesses

  Net contract-based outflows were concentrated in grains and oilseeds.

  Comparison

  Agriculture was stable while energy and precious metals recorded lower open interest.

Key data

• Total commodity open interest$2 trillionDown 3% week on week, or $54 billion, in the week ending 25 September.
• Aggregate net investor positioning$266 billionDown 1% week on week, or $2 billion.
• Projected change in commodity positioning-$19 billionJPMorgan QDS projection as of 28 September, led by gold, grains and petroleum products.
• Energy open interest$928 billionDown 5% week on week, or $47 billion.
• Natural gas open interest$235 billionDown 5% week on week; TTF prices fell 9.4% week on week.
• Precious-metals open interest$303 billionDown 3% week on week, or $10.5 billion, to a six-week low.
• Base-metals open interest$242 billionUp 1% week on week, or $3.2 billion.
• Agricultural-market open interest$427 billionBroadly flat week on week.

Impact & implications

The report portrays a near-term pullback in commodity risk appetite concentrated in energy and precious metals, rather than a uniform retreat across all markets. Copper and broader base metals show relative positioning strength, while tight winter gas conditions, disrupted LNG transit patterns and copper supply risks remain important sources of potential volatility.

Risks

• Copper supply faces risks from South American diesel availability, El Niño weather effects and a potential Chilean strike.
• Natural-gas markets face tight winter fundamentals, elevated prices and high volatility while LNG transit conditions remain unclear.
• A prolonged US diesel export restriction could ultimately affect US refining capacity.

What to watch

• QatarEnergy LNG tanker transit activity through the Strait of Hormuz and clarity on transit conditions.
• Winter natural-gas market tightness and European and Asian benchmark prices.
• Copper supply conditions, including South American diesel availability, El Niño impacts and Chilean labor developments.
• Implementation of lower US-China tariffs and progress toward China's planned purchases of US agricultural products.