- The CFTC is investigating suspicious oil futures trades before Trump's Iran policy announcements
- Trading volumes surged twice before major Trump statements on Iran and oil prices dropped sharply
- Data from CME and ICE exchanges, including trader IDs, has been requested for the probe
The top US derivatives regulator is investigating a series of suspiciously well-timed trades in the oil futures market ahead of recent policy pivots by President Donald Trump related to the war in Iran, according to people familiar with the matter.
The Commodity Futures Trading Commission is leading the probe into trading of oil futures contracts on platforms belonging to CME Group Inc. and Intercontinental Exchange Inc., said the people, who asked not to be identified as the information is private. Both exchanges were asked to hand over data, the people said.
The CFTC is looking into at least two instances over a period of about two weeks where trading volumes surged shortly before major announcements, the people said. Data requested from the exchanges include the so-called Tag 50 identifications of the entities behind the trades, the people said.
Recent examples where oil trading volumes spiked at key moments in the past few weeks have raised concerns about potential misuse of material non-public information tied to Trump's shifting stance on the war in Iran. Historic disruption to Middle Eastern oil flows sent oil soaring at the start of the conflict. Prices whipsawed in subsequent weeks on speculation over when tanker traffic might resume through the Strait of Hormuz.
The CFTC and Intercontinental Exchange declined to comment on the investigation. A White House spokesperson referred comment to the CFTC.
"We vigorously surveil our markets and work closely with the CFTC to oversee trading activity," CME said in a statement. "Importantly, any review of market behavior must include all venues, including prediction markets like Polymarket and Kalshi that list related products with little to no visibility."
Kalshi declined to comment while Polymarket didn't immediately respond to a request for comment.
As scrutiny of the well-timed trades has intensified, two Democratic senators have urged the CFTC to examine potential irregularities. The White House circulated an internal memo last month cautioning staff against trading on sensitive information in financial markets and rapidly expanding event-based betting platforms.
"These suspicious oil trades look like an appalling example of insiders rigging the market," Democratic Senator Elizabeth Warren said in a statement Wednesday. The probe "is a start, but CFTC and the SEC should do their job and investigate anything that looks like insider trading by Trump Administration officials."
On March 23, oil and stocks futures worth billions of dollars were traded 15 minutes before Trump said previously threatened strikes on Iranian energy infrastructure would be delayed. The president's comments in a Truth Social post sent crude prices plummeting and equities soaring.
A similar pattern was observed ahead of Trump's April 7 announcement of a two-week ceasefire with Iran. Futures activity increased in the hours before the news, which caused both oil and gas prices to plunge.
West Texas Intermediate oil futures, the most widely cited price for US crude, trade on the CME's Nymex platform. Brent oil, the global benchmark, trades on Intercontinental Exchange's ICE Futures Europe exchange.
While the CFTC can request data directly from CME for WTI trades, since Nymex is based in New York, any request regarding Brent needs to be made via the UK's Financial Conduct Authority because Brent trades in London, the people said. The FCA didn't immediately respond to a request for comment.
"There's enormous appetite to pursue cases like this," said Brian Young, the former director of the CFTC's enforcement division who's now a partner at Jones Day. "After all, prices at the pump closely correlate to oil futures contracts, so we're talking about American pocketbooks at stake here."
CFTC Enforcement Director David Miller said in late March that the agency was monitoring oil futures trading for potential irregularities, while declining to comment on any specific investigations.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
