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Hansen: Trading oil and gold volatility

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Airstrikes on Yemen have resulted in the oil price moving up significantly. The country may only be a small oil producer, but it borders Saudi Arabia, the largest producer of crude in the world. The strait between Yemen and Dijbouti transfers three million barrels to Europe a day. But Saxo's Ole Hansen says it's WTI that's benefited the most due to increased speculative shorts. 

Hansen says that near-term there is an increased risk that the price of oil will track higher due to this geopolitical risk. But he says the world is still 'awash with oil'. He believes investors should look at WTI crude on the May futures as there is an option expiring on 16th April.

Gold too is up thanks to a weaker dollar, falling bond yields, a 'wobble' in the US equity markets plus increased geopolitical risk. Hansen says it could move as high as 1225 USD/Oz.