Timing of the Trades
The Department of Justice (DOJ) is investigating a series of suspiciously timed trades in the oil market totaling $2.6 billion. These trades occurred just ahead of major announcements by President Donald Trump and a top Iranian official regarding the war in Iran. The DOJ, along with the Commodity Futures Trading Commission, is probing at least four trades.
Details of the Investigation
Federal officials are specifically examining trades where investors bet that oil prices would drop right before they did. ABC News obtained data of the four trades from the London Stock Exchange Group. On March 23, traders bet more than $500 million that oil prices would fall, 15 minutes before Trump announced he would delay attacks on Iran's power grid. On April 7, hours before Trump announced a temporary ceasefire, traders bet $960 million that oil prices would fall. On April 17, 20 minutes before Iran's Foreign Minister Abbas Araghchi posted on social media that the Strait of Hormuz was open, traders bet $760 million that oil prices would fall. On April 21, traders placed a series of bets worth $430 million that oil prices would fall, 15 minutes before Trump announced he would extend the ceasefire.
Market Impact of the War
Shell Plc reported stronger-than-expected first-quarter earnings. The Iran war boosted trading profits and energy prices. Shell's profits for the first three months of the year were $6.92 billion, up from $5.58 billion in the same period a year earlier. The price of Brent crude, the global benchmark for oil prices, was around $73 a barrel before the conflict began. Brent currently stands at about $101 a barrel.
Global Economic Concerns
Southeast Asian leaders are gathering in the Philippines for an annual summit, seeking to bolster economic cooperation and shore up regional resilience as countries grapple with an energy shock tied to the war in Iran. Rising oil prices are driving up import bills as remittances fall and currencies weaken.
Potential Deal on the Horizon
The US and Iran are considering a fresh proposal to end the war. The US presented a one-page memorandum of understanding to Iran that would gradually reopen the Strait of Hormuz and lift the American blockade on Iranian ports, according to a person familiar with the measure. The data from LSEG does not indicate any identities behind these trades and does not prove individuals were trading based on insider information.
