According to Saxo Bank's head of commodity strategy Ole Hansen, oil has come down since we saw verbal intervention from key Opec producers earlier in August. WTI is currently trading in a $46.50-$48.50/b price range.

Hansen says that 80% of the recent buying has been short covering and that the net longs have risen close to this year's highest level.

However, Hansen says we could see long liquidations if WTI goes below $46.50/b.