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OIL OPTIONS: Brent Holds Strong Call Bias as Options Open Interest Surges

OIL OPTIONS
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The near term Brent options continue to show a strong volatility bias to the calls as participants are seeking protection in the event of a price spike as risks still surround future Middle East supply while awaiting Israel’s response to Iran’s strikes.

  • Brent option open interest has risen to a record high this month of over 4m contracts surpassing the previous high of 3.6m in September.
  • The aggregate open interest across ICE Brent call option contracts is up to 2.41m for call contracts while put open interest has also risen to 1.68m contracts. The key open put option positions are spread between strikes 50$/bbl to 70$/bbl and the main call volumes are between 80$/bbl and 110$/bbl.
  • Aggregate Brent options volumes are well above normal again this week, averaging 347k of which 244k is call options.
  • The Brent second month 25 delta call-put spread is the most bullish since March 2022 up to just above 10% today while the WTI skew is nearly 6%.
    • Brent DEC 24 up 1.9% at 76.37$/bbl
    • WTI DEC 24 up 2% at 72.19$/bbl

 

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The near term Brent options continue to show a strong volatility bias to the calls as participants are seeking protection in the event of a price spike as risks still surround future Middle East supply while awaiting Israel’s response to Iran’s strikes.

  • Brent option open interest has risen to a record high this month of over 4m contracts surpassing the previous high of 3.6m in September.
  • The aggregate open interest across ICE Brent call option contracts is up to 2.41m for call contracts while put open interest has also risen to 1.68m contracts. The key open put option positions are spread between strikes 50$/bbl to 70$/bbl and the main call volumes are between 80$/bbl and 110$/bbl.
  • Aggregate Brent options volumes are well above normal again this week, averaging 347k of which 244k is call options.
  • The Brent second month 25 delta call-put spread is the most bullish since March 2022 up to just above 10% today while the WTI skew is nearly 6%.
    • Brent DEC 24 up 1.9% at 76.37$/bbl
    • WTI DEC 24 up 2% at 72.19$/bbl

 

Keep reading...Show less