From ZeroHedge, May 7:
U.S. authorities are investigating more than $2.6 billion in oil futures shorts that landed within minutes of major announcements tied to the 2026 U.S.-Iran conflict. The Department of Justice (DOJ) has joined the Commodity Futures Trading Commission (CFTC) in a widening inquiry into potential misuse of material non-public information in one of the most liquid and geopolitically sensitive commodity markets on earth, ABC News reports.
The trades in question involved bets that oil prices would fall shortly before major U.S. or Iranian announcements tied to the Iran war. .
The Trades
Data sourced from the London Stock Exchange Group (LSEG) - which captures exchange-traded futures flow but strips identities - reveals four distinct clusters of aggressive shorting in WTI and Brent crude futures:
- March 23: >$500 million in shorts executed in a one-minute burst roughly 15 minutes before President Trump announced a five-day delay on planned strikes against Iran's energy infrastructure. Oil prices subsequently plunged ~15%.
- April 7: ~$960 million short position placed hours before the temporary ceasefire announcement (oil dropped sharply on the news).
- April 17: $760 million short bet executed ~20 minutes before Iranian Foreign Minister Abbas Araghchi declared the Strait of Hormuz open to commercial traffic.
- April 21: $430 million additional short layer placed 15 minutes before Trump extended the ceasefire.
Total exposure: >$2.65 billion in directional bets that oil's geopolitical risk premium was about to collapse. These were institutional-sized clips that moved the tape.
The CTFC began investigating suspicious oil trades last month, which has now expanded under DOJ scrutiny....
....MUCH MORE
