I have to admit that I was a bit taken aback when the Kuwaiti oil minister announced that the world could withstand oil at $100 barrel. It wasn’t that an oil minister said it; it was that the oil minister was from Kuwait and not Iran. Along with that eye-opening statement, we are seeing some very interesting things in the oil markets right now.

For instance, anticipation of growth has rallied oil despite an economy that hasn’t really done much in three years; China seems to realize it may have overdone the increase of its currency rates in an attempt to slow down the rally in commodity prices; a computer virus may have set the Iran nuclear program back two years; and an American car company can’t make a competitively priced electric car without the government’s $8,000 tax credit.

But all those factors probably weigh less on the oil markets than currency issues. Yes, oil is up $10, but how much is the U.S. dollar down against the euro and against every other world currency? One thing we know is that the QE2 effort has weakened the dollar against other currencies.

While the increase in oil prices will help U.S. oil companies like Exxon Mobil Corp. (NYSE: XOM) and Chevron Corp. (NYSE: CVX), the real beneficiaries are foreign oil companies. One might be BP plc (NYSE: BP); however, it will be paying for its disastrous oil spill for some time, making it less likely to truly gain much value. Personally, I think the real winner will be Petroleo Brasileiro SA (NYSE: PBR).

Petrobras has a lot of things working in its favor. It is sitting on oil reserves that are so large the experts don’t know how many billions of barrels it holds. The company will benefit from an increase in currency valuation, and for the most part seems well run (unlike many foreign oil companies).

The paper flow over the past few days seems to be agreeing with me. We have been seeing large amounts of put sellers and call buyers across many option strikes in Petrobras. On Dec. 27, for instance, we saw call volume in every upside February call. At the same time, implied volatility (IV) was sitting on its lows.

With low IV and a tremendous upside, I see value in owning something like the PBR April 34 Calls in the $2.50 range. I could see PBR easily making it back through $38 and possibly $40 ahead of or after its earnings release, which is scheduled for March 18. Especially if the U.S. dollar keeps losing value and oil keeps rallying.

Editor’s note: We previously listed the PBR March 34 Calls here rather than the PBR April 34 Calls. We apologize for any confusion this may have caused.  

Follow Mark Sebastian on Twitter @optionpit.