We can't afford to ignore Grand Theft Oil Futures |
Last Wednesday in America another glimmer of hope the Middle East war could be resolved was reported by US news website Axios, based on information from within the White House.
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The report went online at 4.50am New York time. But 70 minutes beforehand, there was a flurry of futures trades. Short sellers had bet the price of oil would fall, which it duly did.
According to the rule of three, if it happens once, it's an accident; twice, it's a coincidence; three times and it's a pattern. There have certainly been enough exquisitely timed futures flurries since the war began and the Strait of Hormuz was closed to raise more than a whiff of insider trading suspicion.
On March 23, 15 minutes before Donald Trump announced on his Truth Social platform that the US would delay its threatened strikes on Iranian energy and water infrastructure, US$2.2 billion worth of trades were executed on West Texas Intermediate and Brent and other petrol futures. Accident?
On April 7, just before Trump announced a ceasefire, US$2.12 billion in oil futures was traded in a single minute. Coincidence?
Then, on April 17, just before Iran declared the Strait of Hormuz completely open, another furious trade, worth US$2 billion. Pattern?
And then last week's big short. Enough of a pattern has emerged to catch the attention of both the US Department of Justice and the Commodity Futures Trading Commission, which are now investigating. Don't hold your breath.
Insider trading is hard to prove at the best of times. In this chaotic era of diplomacy via social media posts, of a president notoriously accessible to anyone who has his mobile number, anyone within the Administration could be leaking to the market. We'll probably never know who but we can be certain traders are profiting from the economic misery the rest of the world is feeling as the energy crisis drags on.
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