Traders bet on oil at $100 as Iran sanctions loom

NEW YORK/LONDON (Reuters) – Oil traders have piled into wagers that U.S. crude oil could surge to $100 a barrel by next year, a milestone that until recently many considered unthinkable due to record U.S. production growth and relatively flat global demand. But the imminent return of U.S. sanctions on Iran and bottlenecks keeping U.S. oil from getting to market have fueled a rally that has taken benchmark oil prices to four-year highs. While big producing nations say supply is ample, hedge funds and speculators are increasingly skeptical of that argument, betting the market could rally further as sanctions on Iran’s crude exports return on Nov. 4. The bullishness is visible in the U.S. options market. The number of open positions on $100 December 2019 WTI call options CL1000L9 – bets on futures hitting that price by the end of 2019 – has risen by 30 percent in the last week to a record 31,000 lots, according to CME data. “Over the last two weeks, there’s been a lot more evidence that even some of the larger customers – India and China – are not going to be buying Iranian crude from November,” said John Saucer, vice president of research… continue reading

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Source: CTRM Center

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