Rs 5,373 crore in mystery oil bets placed 15 minutes before Trump's Iran talks post: Report
A Financial Times report states that just minutes before Trump announced a halt to Iran strikes, massive bets were placed in the oil market, amounting to billions of dollars. A sudden flurry of activity was reported in the oil market between 6:49 am and 6:50 am ET.
Oil market bets worth billions minutes before Trump's post on Iran
Merely 15 minutes before Donald Trump shared a post about “productive” talks with Iran, bets worth half a billion dollars were placed in the oil market, according to a Financial Times report. Early on Monday morning, just hours before markets opened, the US president went back on the deadline given to Iran to open the Strait of Hormuz, and said all strikes on Iranian power plants and energy infrastructure will be held off for five days.
Sudden activity reported in the oil market
Soon after he made the claim, the price of crude tumbled and ignited volatility in other assets. According to trading platform Unusual Whales, two bets were placed by either one or several entities. S&P 500 futures worth about Rs 12,600 crore were bought, or 1.5 billion dollars, positioning for a market rally if tensions eased. Then they sold oil futures worth about Rs 1,615 crore, or 192 million dollars, basing it on a drop in crude prices if supply fears faded. Between 6:49 am and 6:50 am ET, around 6,200 Brent and West Texas Intermediate futures contracts worth roughly 580 million dollars, or about Rs 5,373 crore changed hands.
S&P 500 futures witnessed sharp price jump
Financial Times analysis of Bloomberg data showed that the notional value of these high-speed trades touched approximately $580 million. Only 27 seconds before 6.50 am, trading volumes for Brent and WTI also witnessed a sudden jump. S&P 500 futures also saw a sharp price jump and a significant surge in trading volume after the oil trade.
An immediate global market shift
It is not known where one or several entities were behind Monday's trade. But this synchronised movement suggests that the same market sentiment, or the same group of traders, could be simultaneously betting on a broader economic rally. As soon as Trump announced 7.04 am, it sparked an immediate global market shift as investors, sensing a de-escalation, jumped into equities.
Market strategists question timing of trade
A market strategist at a US broker raised concerns about the sudden change, questioning the timing. He told the outlet, "who would have been relatively aggressive at selling futures at that point, 15 minutes before Trump’s post." Meanwhile, White House spokesperson Kush Desai dismissed rumours of insider trading.
White House says it does not allow illegally profiteering off of insider knowledge
He said, "The White House does not tolerate any administration official illegally profiteering off of insider knowledge, and any implication that officials are engaged in such activity without evidence is baseless and irresponsible reporting." Many hedge funds also noted that this was just one of many such "large trades" ahead of government announcements in recent months.
Oil trade case echoes Polymarket bets right before Maduro was captured
The case echoes the Venezuela bets placed in Polymarket right before Trump took President Nicolas Maduro into custody. Some of its customers placed suspiciously well-timed bets right before the US attacked Venezuela and arrested Maduro. One user apparently made hundreds of thousands of dollars on wagers related to the timing of US strikes on Iran.
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