Calls vs Puts

First off, there are always two parties involved in a transaction, the insurer and the insured party, or the seller of the option and the buyer of the option.

When viewed from the perspective of the buyer:

The buyer insured himself against a rise in price but in the event that price should exceed the agreed-upon price level, then the buyer will be able to BUY the commodity at that agreed fixed price. When the option results in the buyer purchasing the underlying commodity we talk about a CALL OPTION.

Likewise, protection against prices falling will mean that the insured party (the buyer of the insurance policy, the buyer of the option) will be able to SELL the commodity at the agreed upon, fixed price. When the option results in the buyer selling the underlying commodity, we refer to this policy as a PUT OPTION.