Diamondback Bets Big on WTI-Brent Price Gap Amid Export Ban Fears

Diamondback Energy, the top producer in the Permian Basin, has bought options to sell the difference between US West Texas Intermediate (WTI) crude and globally traded Brent crude at a significant loss. The company purchased put options for nearly $70 million to sell up to 255,000 barrels per day at minus $41.67 a barrel in the second quarter of 2026 and up to 290,000 barrels per day at minus $42.76 in the third quarter.

The unusual hedge signals how oil companies are looking for ways to insure their revenue amid concerns that the US government could halt exports of crude oil. The spread between WTI and Brent was trading at minus $9.29 a barrel on Friday, but it had traded as low as minus $20.69 in March due to export ban concerns.

Tim Skirrow, the head of derivatives at research firm Energy Aspects, said that the risk of a US crude export ban would decrease US crude prices significantly compared to global benchmarks like Brent. Diamondback's hedge is rare among producers and could pay off if WTI trades about $42 lower than Brent.