Commodity option volatility & CL IV

Discussion in 'Options' started by rubikscube, May 16, 2018.

  1. Hello everybody.

    Can someone give me a bit of insight into how CL implied volatility moves please? Does it follow a vol smile typical of commodities? i.e IV is lowest ATM and then there is an even-ish skew either side with any move up OR down in causing an increase in IV?

    I have witnessed some strange moves over the last few days where it seems to behave more like an equities vol skew than a commodities smile, in that small price rises in oil have resulted in vol dropping.

    Also is this typical of how vol moves in most commodities? I was always lead to believe that because of the commodity smile, any move up or down would result in an IV increase.

    How does this actually manifest itself in the real world?

    Thanks for any help.
  2. Is anyone able to give me some insight on this please? I would be really grateful. I can't really work out how the vol moves in CL it seems to be a bit random?