Brent crude oil fluctuates within a wide range. How to hedge against crude oil's sharp rise and fall on Gate TradFi?

The crude oil market in 2026 can be described as a textbook-level “stress test.” Since the beginning of the year, Brent crude oil prices have soared from around $73 per barrel to over $119 per barrel, then plummeted nearly 20% in a single day on April 8 due to news of a temporary ceasefire between the US and Iran, marking the largest single-day decline since April 2020. As of the early morning of April 10, the main Brent crude futures contract was around $96.70 per barrel, while WTI crude approached $99 per barrel, with intraday fluctuations still wide between $0.5 and $1.5.

Faced with such intense price volatility, both physical enterprises and individual investors need an efficient hedging tool.

Why Do Oil Prices Surge and Plunge? Geopolitical Risk Premiums Repeatedly Tugged

The core driver of this round of sharp oil price fluctuations is the risk of supply disruption in the Strait of Hormuz.

Approximately 20% of global crude oil is transported through the Strait of Hormuz. Since the full escalation of the US-Iran conflict at the end of February, shipping security in this strait has been continuously threatened. Brent crude spot prices once broke through $140 per barrel, hitting a new high since 2008, and the spread between futures and spot prices widened to over $30 per barrel, reaching a historic extreme.

However, after the US and Iran reached a two-week temporary ceasefire agreement in early April, the market quickly reversed. On April 8, WTI crude oil plummeted nearly 20% in one day, but within less than a day, Israel launched fierce airstrikes on Lebanon, and the Strait of Hormuz was closed again. On April 9, Brent crude rebounded over 3%, closing at $97.6 per barrel.

Guotai Junan Futures analysts believe that the risk of oil prices rising has not been eliminated. If negotiations between the US and Iran falter and military conflicts escalate again, Brent crude could still break through $120 per barrel and challenge the $130–$160 range within the next 3–5 months. The EIA also raised its 2026 Brent price forecast to $96 per barrel, expecting that lagging supply-demand recovery will support oil prices to remain in the high range of $90–$100 in the short to medium term.

In summary: short-term oil prices are unlikely to stabilize, and wide fluctuations will become the norm.

Three Major Pain Points of Traditional Crude Oil Hedging Channels

For ordinary investors, participating in oil markets or hedging risks through traditional channels is not user-friendly:

Pain Point 1: Complicated account opening process. You need to open offshore securities or futures accounts, complete complex W-8BEN forms, convert fiat currency to USD, and transfer cross-border, which can take from a week to a month.

Pain Point 2: High capital threshold. Traditional crude oil futures contracts are worth tens of thousands of dollars, and margin requirements make it difficult for ordinary investors to participate.

Pain Point 3: Limited trading hours. Traditional WTI crude futures only trade during specific hours Monday through Friday, with markets closed on weekends and holidays. But geopolitical events never happen within trading hours—unexpected ceasefire negotiations, military escalation announcements—these can be released at any time, even early Saturday mornings.

Gate TradFi: Hedge Oil Fluctuations Directly with USDT

Gate TradFi’s crude oil spread contract trading is designed to solve these issues. Its core advantages are reflected in three aspects:

1. USDT Direct Trading, Zero Conversion Costs

You only need to transfer USDT from your main account to the Gate TradFi sub-account. The system will automatically price it as USDx at a 1:1 ratio, without selling USDT, converting fiat, or incurring any currency exchange costs. From decision to open a position to actual execution, it can be done in less than a minute.

2. Coverage of Both Major Oil Benchmarks, Flexible Exposure Selection

Gate TradFi offers spread contracts for two major global oil benchmarks: WTI (XTIUSD), reflecting US market supply and demand, and Brent (XBRUSD), which is more internationally representative, covering about two-thirds of global oil pricing. If the Strait of Hormuz blockade intensifies, Brent’s sensitivity is usually higher; if US domestic inventories become the main driver, WTI warrants more attention.

3. 24/7 Continuous Trading, Capture Every Key Window

This is the most significant advantage of Gate TradFi compared to traditional crude oil futures. Gate’s perpetual oil contracts offer 24/7 continuous trading, allowing you to open or close positions anytime during weekends, late nights, or early mornings. No matter when ceasefire agreements are reached or conflicts escalate, you can respond immediately.

4. Flexible Leverage, Adjust Risk Exposure as Needed

Gate provides leverage options from 5x to 500x. Whether you prefer low leverage for trend trading or high leverage for capturing intraday volatility, you can find a suitable risk exposure.

For hedgers, leverage does not need to be set too high—the key is to establish a reverse position that matches your spot exposure.

How to Build an Oil Hedging Strategy?

On the Gate TradFi platform, the process of hedging oil price risks is very straightforward:

Scenario 1: Bearish on oil prices, avoid downside risk. If you hold a large amount of assets positively correlated with oil prices (such as energy stocks or certain cryptocurrencies), and worry about falling prices causing losses, you can open a Brent crude short position on Gate TradFi to establish a reverse position. When oil prices fall, the profit from the short position can offset the losses of your spot holdings.

Scenario 2: Bullish on oil prices, seize upward opportunities. If geopolitical tensions escalate again and oil prices are expected to break through $120 per barrel, you can directly participate by opening a long position in oil or use it as protection for existing short assets.

Scenario 3: Cross-asset arbitrage hedging. Since the crypto market and traditional assets have short-term correlations, institutional investors often hedge by combining long positions in oil with short positions in cryptocurrencies to balance overall account risk exposure.

Gate’s unified account system supports centralized management of both crypto assets and traditional financial assets. Hedging, rebalancing, and strategy reuse can all be done within the same account framework, significantly reducing friction costs.

Risk Tips and Precautions

Although Gate TradFi greatly facilitates oil hedging, investors should still pay attention to:

• Leverage is a double-edged sword: high leverage means high returns but also high risks. Hedgers are advised to choose moderate leverage according to their risk tolerance.
• Watch liquidity: during non-US trading hours, CFD quotes may have lower liquidity, so be aware of slippage risks.
• Geopolitical uncertainties: current oil price trends heavily depend on the progress of navigation in the Strait of Hormuz and ceasefire negotiations. Keep a close eye on news developments.
• Manage positions carefully: hedging is not speculation. Proper position control and setting stop-loss levels are fundamental for long-term stable trading.

Summary

On April 10, 2026, Brent crude oil fluctuated widely between $96 and $99 per barrel, with WTI approaching $99. Against the backdrop of intense global energy market volatility, the demand for oil risk hedging is more urgent than ever.

Gate TradFi, with its four core advantages—USDT direct trading, coverage of both major oil benchmarks, 24/7 continuous trading, and flexible leverage—breaks down the barriers and limitations of traditional oil trading. It allows crypto investors to participate in the global oil market using familiar USDT, ready to respond to sudden price surges and drops.

Whether you are a risk manager in a physical enterprise or an investor seeking opportunities in the oil market, Gate TradFi provides a convenient and efficient hedging channel. Markets wait for no one, but Gate lets you get on board anytime.