Mexico driving put skew in Brent, say brokers

mexico-flag

The slide of Brent crude oil into a deep put skew over the past three months has been driven to a significant extent by Mexico buying put options to protect the value of its future oil production, according to brokers.

"We generally have once a year what's called the Mexican hedge, when Mexico comes in and hedges its production," says Paul Doherty, an oil options broker at OTC Global Holdings in London. "So they come in and buy a load of puts. That's compounded it, on top of the actual price

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Risk.net? View our subscription options

If you already have an account, please sign in here.

Register

Want to know what’s included in our free membership? Click here

This address will be used to create your account

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: