(Reuters) Hedge funds seem to be quietly positioning for the possible imposition of a border tax adjustment on imports of crude oil into the United States. The principal impact of a border tax adjustment would be to raise the price of domestic crude compared with international grades such as Brent.
Hedge funds have started to anticipate the possibility of a tax being imposed by increasing their exposure to futures and options linked to WTI rather than Brent. In the two weeks between Jan. 10 and Jan. 24, hedge funds added 62 million barrels of extra long positions in WTI while cutting long positions in Brent by 6 million barrels.
