Soaring Oil Prices Push Western Oil Stocks Higher

The Russian-Ukrainian war sent oil prices to 13-year highs

Western Oil Company (NYSE:OXY) is up 3.5% to $58.42 at last check, after the Russian-Ukrainian war sent oil prices crashing 13 year highs. Today’s massive surge came as the United States and its allies considered banning imports of Russian crude, which could lead to slower global economic growth, in addition to higher oil rates. unemployment and inflation. Additionally, two representatives of Carl Icahn will leave the company’s board of directors, after the activist investor left his post.

The shares have been climbing the charts since late February and are currently trading at their highest level since May 2019. Now with a 96% year-to-date lead, the 40-day moving average has acted as a strong trading zone. support. for safety since the beginning of 2022.

On the International Securities Exchange (ISE), Cboe Options Exchange (CBOE) and NASDAQ OMX PHLX (PHLX), OXY’s 50-day put/call volume ratio of 0.52 exceeds 98% of readings of the past year. This means that while calls remain popular on an absolute basis, long puts have been snapped up at a faster than usual rate over the past 10 weeks.

Echoing this, the Schaeffer open put/call interest ratio (SOIR) is above almost 2% of the yearly readings. This indicates that short-term options traders have rarely been more biased.

Today’s options pits, however, paint a different picture. So far, 29,000 calls and 16,000 puts have crossed the band, five times the intraday average. The most popular is the March 47.50 put, followed by the 3/11 60 strike call, with positions open on both.

These traders are in luck. Equity is Schaeffer’s Volatility Dashboard (SVS) sits at 84 out of a possible 100, suggesting that Occidental Petroleum stock has exceeded volatility expectations over the past calendar year – a boon for premium buyers.


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Felix J. Dixon