Traders placed a series of bets worth US$430 million on a drop in crude prices just 15 minutes before US President Donald Trump said he would extend a ceasefire with Iran on Tuesday.
It is the third time this month, and the fourth in total, that large, well-timed directional bets on the oil price have been made shortly before major announcements on the Iran war. One combined wager in March was worth US$500 million, while April's bets have together totalled some US$2.1 billion.
- Between 1954 and 1956 GMT on Tuesday, 4,260 lots of selling hit the oil market, worth a combined US$430 million, based on the prevailing Brent futures price LCOc1, according to LSEG data. Trump said he would extend the ceasefire indefinitely at 2010 GMT.
- The Brent market settles at 1830 GMT, meaning these trades took place in what is known as post-settlement hours, when volumes are usually extremely limited.
- The trades did not have much impact on the price, which edged down to US$100.66 a barrel, from US$100.91 before they took place. After Trump's announcement, Brent crude futures fell to a low of US$96.83 in the minute that followed. They were last trading at US$99.2 a barrel at 1200 GMT on Wednesday.
- On March 23, 15 minutes before Trump announced a delay to threatened attacks on Iranian power infrastructure, anonymous traders placed US$500 million on a drop in the oil price. Similarly, on April 7, bets worth US$950 million went through just hours before Trump's announcement of a two-week ceasefire.
- On April 17, some 20 minutes prior to the Iranian foreign minister posting on social media that the Strait of Hormuz would be open to commercial shipping, traders placed US$760 million in bets on a falling oil price.
- The US Commodity Futures Trading Commission is investigating a series of oil futures trades, including those on March 23 and April 7, that were placed shortly before major policy shifts by Trump related to the war in Iran, a person familiar with the matter said on April 15.
- A spokesperson for the Intercontinental Exchange, known as ICE, declined to comment.
Reuters
