The scramble to secure oil supplies now and into the future has contributed to thesharpincrease in theprice of oil on both the spot market and for future delivery.
It might be too early to call a serious slowdown in the Chinese recovery as the latest data may have been affected by the Lunar New Year, a period that is often associated with a sharpincrease in theprice of food and other goods, which occurred in January in 2012 and February in 2013.
In this scenario the trader is happy to pocket the rich premium available on the options given the length of time to expiration and increase in implied volatility on top of thesharp rise in theprice of the underlying.