The oil market remains tight but overall macro conditions look terrible with economic growth slowing all over the world (even Brazil and China), widening credit spreads and signs of extreme financial system stress in Europe. There is a serious chance of a major negative macroeconomic shock here so I recommend reducing exposure back to 25% of a full position. I would buy back any WTI puts that you sold based on my recommendation on Aug 7th when WTI fell below $83, while the options haven't expired yet you should be able to book 95-98% of the premium received or about $3 per contract as profit. Additionally I would sell the extra crude exposure I recommended at that time. WTI is up $6 per bbl and Brent is up $8 since the the open on August 8th so this is a good time to take profits on those positions ahead of what could be a very ugly fall shoulder season.
At this point, I would only own 25% of a full position in crude with that position held in middle or back of the oil curve (preferibly 2015 or later Brent contracts). While, the oil market is still tight and may tighten further if Libyan production doesn't restart shortly, the risk of a negative macro economic shock is too high to carry any more exposure than that minimal position. Ideally I would just hold a minimal position right now with all of it held in Dec 2019 Brent (which is exceptionally cheap due to the high level of backwardation in the current market)
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