Bloomberg reported that hedge funds have turned more pessimistic on oil as prices flirted with $40 a barrel for the first time since August.

Bloomberg noted, citing an International Energy Agency report, oil inventories in developed countries have expanded to a record of almost 3 billion barrels because of massive supplies from both OPEC and non-OPEC producers.

Bloomberg said, according to data from ICE Futures Europe, that traders increased their bullish stance in Brent crude to the highest level in a month during the period.