Traders Wager $430 Million on Decline in Oil Prices Ahead of Potential Trump Ceasefire Extension
Traders Place $430 Million in Bets on Crude Price Drop Before Trump's Iran Ceasefire Announcement
Traders placed a series of bets worth $430 million on a drop in crude prices just 15 minutes before U.S. President Donald Trump said he would extend a ceasefire with Iran on Tuesday. This 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.
According to data from LSEG, between 1954 and 1956 GMT on Tuesday, 4,260 lots of selling hit the oil market, worth a combined $430 million, based on the prevailing Brent futures price. This occurred in post-settlement hours, when volumes are usually extremely limited, and the Brent market settles at 1830 GMT.
The trades did not have much impact on the price, which edged down to $100.66 a barrel, from $100.91 before they took place. After Trump's announcement, Brent crude futures fell to a low of $96.83 in the minute that followed. They were last trading at $99.2 a barrel at 1200 GMT on Wednesday.
Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data
| Date | Bet Size (Million) | Event | Price Impact |
|---|---|---|---|
| March 23 | $500 | Trump delays attacks on Iranian power infrastructure | Down to $67.31 (from $72.11) |
| April 7 | $950 | Trump announces two-week ceasefire | Down to $61.45 (from $66.91) |
| April 17 | $760 | Iranian foreign minister posts on social media | Down to $63.45 (from $67.13) |
| April 22 | $430 | Trump extends ceasefire with Iran | Down to $100.66 (from $100.91) |
The U.S. 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. The total value of bets made in April has reached $2.1 billion, with combined wagers in March and April exceeding $2.7 billion.
Investor Takeaway
Investors should be cautious of large, well-timed directional bets on oil prices ahead of major announcements.
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