US probes suspicious $2.6B oil trades tied to Iran announcements
What's the story
The US Department of Justice (DOJ) and the Commodity Futures Trading Commission (CFTC) are investigating over $2.6 billion in suspicious oil trades. The trades were made just minutes before major announcements regarding the Iran conflict, ABC News reported on Thursday. The investigation focuses on whether traders had insider information related to military and diplomatic events involving the US, Iran, and the Strait of Hormuz.
Insider trading
Trump delayed attacks on Iran's power grid
The suspicious trades involved massive bets that oil prices would drop, just before President Trump and a senior Iranian official made major announcements during the conflict. On March 23, traders placed over $500 million in bets against oil prices just 15 minutes before Trump's announcement to delay threatened attacks on Iran's power grid. The announcement led to a sharp decline in oil prices.
Additional trades
Temporary ceasefire announcement
On April 7, traders placed nearly $960 million in bets against oil prices just hours before Trump announced a temporary ceasefire. Another suspicious trade was recorded on April 17 when traders placed $760 million in bearish oil bets about 20 minutes before Iranian Foreign Minister Abbas Araghchi announced that the Strait of Hormuz was open to commercial shipping. The strait is a vital oil chokepoint, and its closure has impacted energy markets throughout the conflict.
Market integrity
Extension of the ceasefire
On April 21, traders placed another $430 million worth of bets against oil prices just 15 minutes before Trump announced an extension of the ceasefire. The trading data doesn't identify the individuals or firms behind these positions and doesn't prove insider trading or any criminal conduct. However, the size and timing of these bets have raised concerns among lawmakers, regulators, and the public that politically connected traders or insiders may have profited from sensitive government information during wartime.
Ongoing probes
Prediction-market platforms linked to Iran war developments
Federal authorities have also looked into unusual activity on prediction-market platforms linked to Iran war developments, including contracts related to ceasefires and military strikes. Last month, an Army soldier was charged with allegedly trading on classified information involving the US military operation to capture Venezuelan strongman Nicolas Maduro. These ongoing investigations highlight the potential for market manipulation and insider trading during times of geopolitical conflict.