CME Sees Record 8M Energy Options Volume as Oil Volatility Soars 12% Weekly
CME Group’s energy options saw implied oil volatility hit its highest since COVID and European natural gas volatility peak since 2023. The energy complex logged over 8 million contracts Friday after WTI futures surged 12% in the biggest weekly gain following near-halt Strait of Hormuz flows.
1. Record Energy Options Volume at CME
CME Group’s energy complex recorded a daily volume exceeding 8 million contracts as traders rushed to hedge against steep commodity price swings. This marked the highest single-day activity on record for the exchange’s oil and gas derivatives.
2. Oil and Gas Volatility Hits Multi-Year Highs
Implied volatility for WTI futures jumped to levels not seen since the COVID crisis, while European natural gas volatility climbed to its highest point since 2023. Aggressive option buying pushed call skew to the most bullish reading in data going back to 2015.
3. Middle East Disruptions Intensify Market Stress
Flows through the Strait of Hormuz, normally handling one-fifth of global oil shipments, were nearly halted, and production cuts by the UAE and Kuwait compounded supply concerns. WTI futures surged 12% on the week, marking the largest weekly gain ever recorded.