Hedge Funds Fleeing Oil?

Hedge funds appear to be cutting their bets on higher oil. How about you?

Despite crude prices hovering around $127 Monday it appears some investors are turning bearish on oil for the long-term. Bloomberg’s Robert Tuttle writes, Hedge-fund managers and speculators reduced bets on higher oil prices by 80 percent since July as crude futures rose to records and U.S. regulators started investigating trading, government data show.

I think the data reported by Bloomberg is very good, adds strategic investor Dennis Gartman, on Fast Money.

"And with crude at such lofty levels I think the government will be looking at crude traders as the sinister characters in this story. "That makes it smart for hedge funds to sit on the sidelines." he says. “I’m also expecting to see the government create a new definition of what a hedger is as their investigation continues.”

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Trader disclosure: On June 2, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Macke Owns (INTC), (DIS), (MSFT), (WMT); Adami Owns (C), (AGU), (BTU), (NUE), (GS), (INTC), (MSFT); Finerman Owns (GS), (AAPL); Finerman's Firm Owns (GE), (MSFT), (NYX), (SBUX), (SUN), (TSO), (VLO); Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (IWM); Finerman's Firm Owns SPX Index Puts; Finerman's Firm And Finerman Own (C) And (C) Leaps; Jon Najarian Owns A Call Spread In (HOC), (MEE), (SBUX), (TSO), (VLO), (AAPL), (COP), (FTO); Jon Najarian Owns (ACI) Call Spreads And Calls; Jon Najarian Owns (ANR) Calls Spreads And Calls; Jon Najarian Owns (C) Preferred Shares; Jon Najarian Owns (KEY) Puts, (LEH) Puts; Jon Najarian Owns (SNM); GE Is The Parent Company Of CNBC; NBC Universal Is The Parent Company Of CNBC

Gartman Owns (AAPL), (AMR), (DIS), (EWC), (SJT), (ADBE), (CQB), (CSH) (SDS); Gartman Is Short (BAC), (ICE), (WFC), (ING), (XOM); CIBC Gartman Index Owns Corn, Soybeans, Copper, Gold, Natrual Gas; CIBC Gartman Index Is Short Crude Oil; CIBC Gartman Index Is Long Chinese & European Equities; CIBC Gartman Index Is Long Canadian Bonds