According to CNBC, as oil prices have returned above $90, energy stocks in the S&P 500 are nearing 52-week highs, and Bloom Energy’s options trading volume has even surpassed SpaceX, making it the focus of the options market. Behind this phenomenon is a re-pricing of the market’s outlook on the battle between alternative energy and fossil fuels.

Rising oil prices typically boost traditional energy stocks, but Bloom Energy—an energy storage and fuel cell company—stands out because: higher oil prices make clean energy’s economics more compelling, while its products can also serve power-demanding sectors such as data centers. The high level of activity in the options market often indicates that institutions are positioning for its future volatility, rather than simply betting on the stock price.

Currently, the S&P 500 Energy sector is nearing its 52-week high, indicating that capital is flowing into energy-related assets. However, Bloom Energy’s options activity may reflect more hedging demand—when oil prices are high, investors may buy put options to hedge the risks of their traditional energy holdings, or bet that favorable policy developments will accelerate the adoption of alternative energy.

Next, investors should focus on Bloom Energy’s earnings report and order data, especially any new contracts with large technology companies or utilities. If oil prices fall below $85, or if the company experiences technical issues or order delays, its upside thesis could be weakened. Conversely, if oil prices remain above $90 and the company secures new customers, the options enthusiasm may translate into stock price momentum.

Risk warning: This article is for informational purposes only and does not constitute investment advice.