BNO enters the back half of May in a position that encapsulates a classic commodity-fund tension: the price is running hard while the shorts who crowded in during early May are quietly cutting their positions.
The price move is the opening fact. BNO closed at $58.81 on May 19, up 2% on the day and 3.4% on the week. Over the past month the fund has gained nearly 30% — a sharp repricing of Brent crude exposure driven by a combination of supply tightness and geopolitical risk. That kind of performance compresses the short case in real time.
Short interest peaked at around 5.8% of the free float on May 13 — the highest reading in the 30-day window — as bearish positioning briefly intensified on the commodity. It has since unwound steadily. By May 19 it had pulled back to 4.8% of the float, a decline of roughly 15% over the month. That retreat is consistent with shorts covering into a rising tape rather than adding conviction. Short count at the intraday peak hit ~900,000 shares; it is now back near 726,000. Days to cover, per the most recent FINRA fortnightly print, is just one day — meaning the float is liquid enough that any remaining shorts could exit quickly.
The lending market tells a story of easing rather than stress. Availability is now running at roughly 1,336% — more than 13 shares available to borrow for every one already borrowed, a dramatically loose pool. That compares with a 52-week low of just 10.8%, which would have represented an almost fully exhausted borrow supply. Even during the short-interest spike in mid-May, availability stayed well above 260%, limiting any squeeze dynamic. Cost to borrow has also fallen materially from its April peaks: it reached nearly 9.2% in early April when the macro backdrop was more unsettled, dropped sharply through mid-May, and now trades near 3.9%. Borrowing costs have risen about 59% over the past month in absolute terms, but the level remains unremarkable for an actively traded commodity ETF. The ORTEX short score has moved in kind — peaking at 55.9 on May 13 before retreating to 44.9 by May 19, now sitting in a moderate range rather than flashing an extreme signal in either direction.
Options positioning is strikingly one-sided in favour of calls. The put/call ratio is 0.16, fractionally below its 20-day average of 0.162 and close to the 52-week low of 0.111. This year's high was 0.42, hit back in April when Brent was under pressure from demand concerns. The steady migration toward calls since then reflects traders using BNO options to express a bullish commodity view, not to hedge existing long exposure. The z-score of -0.34 is statistically unremarkable, but the direction of travel — from near-high PCR in April to near-low PCR in May — tracks almost perfectly with the price recovery in Brent.
Overall, the positioning picture for BNO looks less contested than it did two weeks ago. Bears have pared back, the borrow market is loose, and options skew firmly favours upside participation. What to watch next is whether Brent crude's fundamental drivers — OPEC+ supply decisions and industrial demand data — sustain enough momentum to keep the short cover flowing, or whether a reversal in the commodity triggers a fresh rebuilding of bearish positions in the fund.
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