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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
OIL OPTIONS
The near term crude option put skews have continued to reduce after Saudi Arabia and Russia extended output cuts until the end of the year. The WTI downside skew is the least bearish since February as front month futures rallied up to a high just above 91$/bbl before easing back lower.
- Both the second month Brent and WTI 25 delta call-put skews are back up to -2.25% compared to lows of around -4.7% in late August.
- Longer term 25 delta call-put skews have however resumed the declining trend with a stronger bearish skew this week amid future demand and supply uncertainty. Demand growth in China especially remains a concern with mixed opinions for growth next year coming from attendees at the APPEC conference earlier this week. The Dec24 Brent call-put skew is down to around -7.4% today from around -6.5% in mid August, while the Dec24 WTI skew is similarly down to around -7.45%.
- Brent crude second month implied volatility has risen this week to 27% with WTI up to 27.4%. Trading volumes settled back to near normal yesterday after the spike higher when cuts were announced on 5 Sep.
- Brent NOV 23 down -0.7% at 90$/bbl
- WTI OCT 23 down -0.7% at 86.89$/bbl
Source: Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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