Occidental Petroleum (OXY) Put Prices Surge 346% as Oil Volatility Intensifies

Bearish option positions are delivering exceptional profits in Occidental Petroleum Corporation (OXY).

On June 20, Market Rebellion’s Unusual Activity service identified the purchase of 4,400 July 3rd $43.50 put options at $0.37 per contract, with OXY shares trading at $45.61, significantly exceeding the strike’s previous open interest of just 38 contracts.

The timing proved particularly fortuitous, coming amid broader concerns about oil price volatility and energy sector headwinds that have pressured the stock.

Those July 3rd $43.50 puts have traded as high as $1.65 today with the stock at $42.28, delivering impressive returns of approximately 345.95% from the initial entry price of $0.37. Meanwhile, OXY shares have declined approximately 7.30% from their initial trading level around $45.61, demonstrating how options can deliver significantly amplified returns compared to simply shorting the underlying stock.

This performance illustrates the power of options leverage when the directional thesis proves correct, though it’s important to note that this same leverage can work against traders when market moves go in the opposite direction.

The strong bearish move in OXY comes as the oil and gas company faces challenges from significant crude oil price volatility and geopolitical tensions. Oil markets have experienced extreme volatility, with Brent crude plunging over 7% recently after geopolitical tensions involving Iran and the U.S. initially drove prices higher but then subsided. Crude oil fell to $64.89 per barrel on June 24, down 5.28% from the previous day, and remains 19.72% lower than a year ago.

Occidental Petroleum Corporation specializes in oil and gas exploration and production, with significant operations in the Permian Basin. The company also has interests in chemical manufacturing through its OxyChem subsidiary and is investing in carbon capture and storage technologies.

OXY was last trading at $42.28, down 3.8% on the day and down 7.30% from the $45.61 level when the original bearish put spread activity was spotted.