Oil's Surge Sparks Unusually Active Options Bets on Petrobras, Nike, Goldman Sachs and Other 120+ DTEs

The escalation in the Middle East pushed oil prices up for the fourth consecutive session yesterday. A barrel of West Texas Intermediate (WTI) closed the day at $86.83, while Brent crude closed at $94.07 a barrel.

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As I write this on Thursday morning, the price for a barrel of WTI has gone over $90, while Brent crude has crossed $100.

The bad news means American consumers are paying $4 or more per gallon of gas for the first time since mid-June.

As the wall of worry grows, the S&P 500 continues to leak oil; it's down nearly 1% over the past five trading days. Excluding AI investment, the U.S. economy isn't looking nearly as healthy.

In yesterday's options markets, volume was considerably lower than the 90-day average at 50.13 million. Trading was still bullish, with calls accounting for 57% of the volume.

Approximately 4% of the single-leg trades were for DTEs (days to expiration) of 120 days or longer. That's my focus for today's unusual options activity commentary.

Despite the small number of longer-duration calls and puts, there were 118 unusually active options expiring in 120 days or more yesterday. Of these, the SpaceX (SPCX) March 19/2027 $115 put was the third-highest unusually active option with a Vol/OI (volume-to-open-interest) ratio of 95.27, behind only Nebius Group (NBIS) at 204.01 and Navitas Semiconductor (NVTS) at 109.27.

I've perused all 118 unusually active options. Twenty-three are worth discussing further.

Of the seven unusually active options expiring in 150 days, the two Petrobras (PBR) calls, the On Holdings (ONON) put, and the GM (GM) put are the ones I've chosen to discuss.

First, and probably most obvious, are the Petrobras calls. They set up nicely for a Bull Call Spread where you buy the $22 call and sell the $30 call for a net debit of $0.76. It's basically a bet on the $22 call, but lowering your cost by 11% through the $0.09 premium income from selling the $30 call.

Here's the data for the big trade that took place yesterday at 9:41 a.m. ET. It accounted for almost all of the volume on the day.

Based on this trade, the net debit was $0.63, or 3.3% of the share price.

Here's how the bull call spread looks early in Thursday trading.

As you can see, the potential payoff is enormous with a maximum profit percentage of 852.38% and a risk/reward ratio of just 0.12 to 1. With oil prices set to move higher, not lower, this bet seems very sensible.