Nov. 27 (Bloomberg) -- Goldman Sachs Group Inc. told clients to sell Exxon Mobil Corp., BP Plc, Total SA and Chevron Corp. call options on speculation shares of the world’s biggest oil refiners will be unable to sustain their outpeformance of equity markets as demand for crude remains weak.

Investors should sell call options expiring in March at a strike price about 5 percent higher than where the stocks are currently trading, the brokerage wrote in a note to clients today. Investors would keep the entire premium paid so long as the shares fail to rise above the strike level.

The four refiners have dropped by an average of 5 percent in the past two months, outperforming the 27 percent decline in the MSCI World Index even as the price of crude has fallen, Goldman said, without giving precise dates. The price of crude oil has slid 47 percent since Sept. 30.

“Our commodity analysts expect oil to remain weak near term, dragged down by tight credit and a darkening demand outlook,” London-based analyst Jason Cuttler wrote.

Call options give the purchaser the right to buy underlying shares at a set price on or by a given date. By selling a call option, an investor is betting that the contract won’t be exercised, allowing them to keep as profit the price paid.

The VStoxx Index, which gauges the price paid for options on Euro Stoxx 50 stocks, has surged to a level three times higher than it was a year ago after stock swings and uncertainty increased. Options are derivatives, or securities that derive their value from an underlying asset, and can be used to protect against a decline or to speculate on the future value of an asset.

To contact the reporter on this story: Gareth Gore in Madrid ggore1@bloomberg.net.

Last Updated: November 27, 2008 05:09 EST