The commodity bull market is in full force and it’s not too late to take advantage. Energy futures have had a sharp rally and the trend is likely to continue. Large capitalized companies like ExxonMobil (NYSE: XOM) stand positioned to profit from higher energy prices. After impressive market gains for smaller competitors like Chevron (NYSE: CVX), ExxonMobil’s stock has started to grind higher on similarly positive outlooks. ExxonMobil reports its 2010 fourth quarter earnings on Jan. 31.

Buying the July 80/85 call spread offers traders the opportunity to profit from further gains in Exxon stock while limiting the amount of capital risked. Buying a further-out month gives the trader a longer opportunity to garner profits, though time decay is always an issue. The prices listed here reflect recent pricing but premiums change rapidly in the options market. Double check the options chain for current prices.

By purchasing the July 80 calls for $2.72 and selling the July 85 calls at $1.09, you pay $1.63 and profit when Exxon trades above $81.63, roughly a 5% move in the stock. The idea behind buying a call spread is to risk a smaller and limited amount of capital, instead of buying capital intensive shares at $78. Keep in the mind, if the stock keeps rising it could be called away from you after it surpasses $85.

Exxon recently built up its natural gas infrastructure to complement its enormously profitable petroleum business. As a market leader in crude oil and natural gas, ExxonMobil will continue to be a profitable investment for traders interested in the energy market.