Oil options, oil’s future

From Bloomberg,

The fastest-growing bet in the oil market these days is that the price of crude will double to $200 a barrel by the end of the year.

Options to buy oil for $200 on the New York Mercantile Exchange rose 10-fold in the past two months to 5,533 contracts, a record increase for any similar period. The contracts, the cheapest way to speculate in energy markets, appreciated 36 percent since early December as crude futures reached a record $100.09 on Jan. 3.

The most interesting part of the piece, for me, was this quote:

“One hundred dollars a barrel is actually 14.9 cents a cup, so we’re still talking about oil being remarkably cheap,” said Matthew R. Simmons, chairman of Simmons & Co. International, a Houston-based investment bank that focuses on energy.

I guess? How many cups of gasoline does your car take? USD200 per barrel would impress me mightily, I have to say – though a year is a long time, and growth in OPEC, India and China alone could certainly push it.