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Traders Bet on Return of $100 Oil

A hot streak in the oil market is setting off a wave of bets on how high prices can go.

With crude prices rallying for four straight weeks, trading of oil options—contracts that give the right but not the obligation to buy or sell—has surged.

The number of bullish contracts that pay out if Brent futures surpass $100 a barrel by January—up 19% from the current level—has more than doubled since the beginning of September, data from Intercontinental Exchange analyzed by QuikStrike show.

Shrinking supplies from Iran, along with strong global growth, has fired up bullish sentiment in the oil market. Uncertainty over how much politically troubled OPEC members can pump to make up for production shortfalls could propel prices to $100, say analysts and officials in the Organization of the Petroleum Exporting Countries.

Brent, the benchmark for global crude price has soared 26% this year to $84.16, while West Texas Intermediate the reference price for U.S. crude, has risen 23% to $74.34.