May 28, 2022
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Oil traders betting prices may pass $200 a barrel this month

TRADERS piled into choices that oil may surge even additional after rising to the best since 2008, with some even putting low-cost bets that futures will rise above $200 earlier than the tip of March.

Prices to purchase name choices for increased crude prices surged Monday because the market assessed the potential for a provide cut-off from Russia, one of many world’s greatest exporters. Not less than 200 contracts for the choice to purchase May Brent futures at $200 a barrel traded on Monday, in response to ICE Futures Europe knowledge. The choices expire March 28, three days earlier than the contract settles. The worth to purchase them jumped 152% to $2.39 a barrel.

A $150-a-barrel name possibility for the June Brent contract doubled from Friday, in response to ICE, whereas the price of $180 name choices jumped 110%. The front-month May contract for Brent surged dramatically early on Monday as traders panicked over talks of a Russian crude ban amid Libyan provide disruptions and delays to anticipated progress in Iranian nuclear talks.

JPMorgan Chase & Co stated final week that Brent crude may finish the yr at $185 a barrel ought to Russian provides proceed to be disrupted, whereas Australia & New Zealand Banking Group Ltd. noticed round 5 million barrels a day of pipeline and seaborne oil provides being impacted by new sanctions.

Russia is the world’s third-largest oil producer behind the US and Saudi Arabia. The OPEC+ member exported 7.8 million barrels a day of crude, condensate and oil merchandise in December final yr, in response to the Worldwide Vitality Company, supplying key fuels resembling diesel, gas oil, vacuum fuel oil and a petrochemical feedstock referred to as naphtha to consumers throughout Europe, the US and Asia. — Bloomberg

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