Striking Insights: Introducing Quarter Strikes in Weekly Crude Oil Options

  • 28 Jun 2021
  • By CME Group
  • Topics: Energy

Trending product: Weekly Crude Oil options

  • Beginning June 28, strike increments for weekly WTI and Brent options will be reduced from $0.50 to $0.25.
  • Reduced strike increments will provide a more precise mechanism for managing short-term crude oil exposure.
  • Weekly options offer a low-cost tool to mitigate risk associated with physical or financial positions in crude oil.

Our article, Hedging with WTI Crude Oil Weekly Options, provides a range of use cases and strategies for weekly WTI options for storage, upstream, and downstream risk management.


Micro WTI futures launching July 12

  • At 1/10 the size of the benchmark WTI futures contract, Micro WTI Crude Oil futures provide a smaller, more precise instrument for managing Crude options delta.
  • For example, a trader will now be able to hedge a 60 delta in-the-money Crude Oil call option by selling six Micro WTI Crude futures contracts, resulting in a delta-neutral position.
  • Access the same robust transparency and price discovery of larger WTI futures with smaller margin requirements.

Learn more about how Micro WTI Crude Oil futures can be used to more precisely manage delta on Crude Oil options.


New Financial TTF futures and options coming soon

On July 12, CME Group will be launching four new financially-settled Dutch TTF Natural Gas products:

  • The launch of four new Financial TTF products further expands our risk management offerings across the global natural gas market.
  • Three new Financial TTF futures will be distributed on Trayport and Globex.
  • Financial TTF options will leverage our technology on CME Direct and Quikstrike’s options pricing and analysis tools.

Learn more about the new Financial TTF products.


Trending tool: OPEC Watch Tool

Stay up to date with the latest probabilities of expected outcomes for the upcoming July 1 OPEC meeting with the CME OPEC Watch Tool.

  • Using WTI Crude Oil options market price data, the tool calculates the implied probabilities of OPEC event outcomes.
  • The three outcomes are generalized as ‘Ease Output Cuts,’ ‘End Output Cuts,’ and ‘Further Output Cuts.’
  • The tool assigns a probability to each of those outcomes calculated using the nearest weekly and monthly option expirations.

Stay current with the latest possible outcomes of the OPEC meeting with our tool.


Contact the team

Contact us for any questions on trading Energy options at CME Group.

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