Physical
What is happening in the oil system.
Oil volatility & options dislocation signals
Oil is physical.
Its uncertainty is not.
Supply, logistics, policy, conflict and expectations create an information environment around crude long before they collapse into a market price. Skarnode converts that structure into a signal and compares it with what oil volatility markets already price.Not a summary of the news.
A signal derived independently of market prices.
WTI options
relative volatility
ATM = 1.0
Oil / movement / uncertainty
Before oil becomes a price, it is already in motion.
Crude moves through ports, chokepoints, inventories, weather, policy and conflict long before those forces collapse into a single market price. Around that physical system sits another system: information.
- Supply
- Ports
- Policy
- Conflict
- Inventories
- Expectations
- Local reporting
- Logistics
Skarnode does not summarise this flow. It measures how its structure changes.
route field volatility contour port / transferconceptual / not live AIS
Three states
Skarnode detects market dislocations.
The information-derived signal and the traded market do not always move together. Skarnode identifies when that divergence becomes unusual — and where it shows up on the volatility surface.
Information
How the surrounding information environment is changing.
Market
What volatility and derivatives are already pricing.
The oil signal in practice
Its strongest derivatives evidence: vega dislocation.
The Skarnode oil signal compares an information-derived state with the WTI volatility surface. Its most extreme and most rigorously tested manifestation is in vega: dislocations in the surface have historically been followed by materially different repricing behaviour.
- Information signal
- Difference vs. traded market
- Surface dislocation
- Vega repricing behaviour
Normal53.4%
Elevated62.3%
Extreme82.4%
Directional accuracy of subsequent residual vega repricing
The relationship strengthens as the dislocation becomes more extreme.
Results
Extreme dislocations behaved differently.
82.4%
Directional accuracy following extreme vega dislocations
46.8%
Of the largest subsequent vega repricings identified from a state representing only 14.7% of observations
93.6%
Directional accuracy among the captured extreme repricing events
Frozen hold-forward evaluation of WTI options. Statistics describe subsequent CME-vega repricing, not investment returns.
What Skarnode shows
Surface
Where information-derived volatility and the traded oil-options market diverge.
Severity
How unusual the dislocation is relative to historical states.
Concentration
Where the dislocation is concentrated across the surface.
The signal
An independent signal beside the market.
Price tells you where the market is. Skarnode delivers a signal derived independently of price — comparable against it, not derived from it.
WTI Vega DislocationIllustrative interface
- Surface state
- Elevated
- Extreme cells
- 17
- Dislocation breadth
- High
- Concentration
- Front / downside
- Largest divergence
- Nov-26 / 72 put
Illustrative interface using historical signal fields.
Historical signal archive
Date-aligned signals for backtesting against your own market data, strategies or exposures.
Current signal state
Current measurements of information/market divergence and regime severity.
Options-surface signal feed
Strike- and expiry-level signal data designed to sit beside your existing WTI options data.
CSV / Parquet / API
Who it is for
For desks that already have the market data.
Oil trading desksOptions & volatilityCommodity fundsSystematic macroQuantitative researchMarket risk
You already have the market data. Skarnode gives you the independent signal that sits beside it.
See it against your market.
Skarnode is available to professional oil, derivatives and volatility teams for evaluation alongside their existing market data.
Historical signal archiveCurrent signal stateOptions-surface signal feedAPI / CSV / Parquet