OIES Podcast – Algorithmic Oil Traders, Hedge Fund Strategies and Oil Markets

In this latest episode of the OIES podcast series, Bassam Fattouh (Director of the Oxford Institute for Energy Studies) discusses with Ilia Bouchouev (managing partner at Pentathlon Investments, Senior Research Fellow at OIES, and adjunct Professor at New York University) recent trends in options trading, algorithmic trading and hedge fund strategies that are shaping oil markets. Based on recent research from the OIES Energy Quantamentals series, they focus on key themes including:

• The role of fundamentals versus financial flows in oil price formation
• Volatility risk premiums and the shrinking supply of insurance and the implications for oil markets
• Whether the elevated option premiums represent excess profits for sellers or fair compensation for bearing tail risks, and whether option sellers amplify or dampen sharp price movements during market stress
• Competing algorithmic strategies and how these have been evolving in a price range bound environment
• How spikes in call option open interest during geopolitical tensions may influence algorithmic positioning, and how options markets, volatility premiums, and systematic strategies interact to drive price moves
• Comparison of momentum-based strategies that reinforce large fund positioning versus contrarian strategies that bet on mean reversion, and analysis of why contrarian strategies have recently outperformed
• The Impact of AI on oil trading and market volatility
• Key indicators and positioning trends to monitor in 2026 for understanding the influence of algorithmic strategies and hedge fund flows on oil prices

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