Russia is considering whether to adopt a kind of state oil hedging program, similar to Mexico’s oil hedge, to protect government revenues from oil price crashes in the future, Russian news agency Interfax reported on Wednesday, quoting sources familiar with the matter. The Mexican oil hedge , or the Hacienda Hedge, is considered the biggest hedging bet on Wall Street as well as perhaps the most secretive. It has earned Mexico—and a few large investment banks—billions of U.S. dollars. Every year, Mexico buys put options from investment banks and typically hedges a whopping 200-300 million barrels of oil. With the put options, it has the right, but not the obligation, to sell oil at a previously set price and timing. Such hedges minimize the losses in case oil prices crash. Earlier this year, it was the oil hedge that is thought to have saved Mexico’s economy from collapsing. Now […]