Oil Traders Raise Bets on $80 Crude on Supply Concern
Record oil prices may increase to $80 a barrel this year, options contracts on the New York Mercantile Exchange show. Investors are speculating OPEC won't produce enough oil to compensate for any disruption to supplies.
New York Mercantile Exchange data show 6,900 options contracts outstanding that allow buyers to purchase oil for December delivery at $80 a barrel, compared with an average of 77 contracts in January. The probability that oil will top $75 a barrel when the December crude contract expires is 21 percent, according to Adam Sieminski and Michael Lewis, strategists at Deutsche Bank AG, up from 5 percent at the start of the year.
Oil has surged partly on concern that a dispute over Iran's nuclear program to generate electricity may lead to conflict with the U.S. and disrupt supplies from the Middle East. The cushion between output capacity and demand is narrowing as producers including most OPEC members pump at maximum.
|<< PREVIOUS||NEXT >>|
blog comments powered by Disqus