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For the first time in six years, a rule in one of the most popular commodity market indices was triggered Friday, requiring funds tracking the index to sell Brent crude futures contracts for December and to buy contracts for June.The S&P GSCI Enhanced Commodity Index rule aims to ensure that investors are positioned to cash in when oil market fundamentals change – in this case, when supply becomes so tight that the current price of oil becomes higher than the price of oil for delivery many months or years into the future. An S&P bulletin late Friday confirmed the rule had been triggered for Brent contracts. It stipulates that the funds must bring their money forward if the second and third month contract settles at a difference of less than 0.5 percent on the third to the last day of any given trading month.The Brent May contract price settled at $56.31 a barrel Friday, while the June price settled at $56.55 a barrel. Each contract represents 1,000 barrels.
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