The warnings are already in: the reason crude oil keeps climbing in an already volatile market isn’t solely because shortages are starting to bite. It’s because there are insiders with privileged information who are cashing in big on the Iran war. So while you pay increasingly higher gas prices, some on Wall Street are getting rich.
Yesterday, alarms sounded when it emerged that an anonymous trader had placed an unprecedented amount of bets in the oil futures market that oil would rise. This pattern has appeared before: on March 23, anonymous and perfectly synchronized bets were placed minutes before Trump announced developments in the war. Result? Gains of between 40 and 50 million dollars in a matter of minutes.
When the problem is speculation
On Wall Street, observers are seeing how refiners and commodity traders are pocketing millions and millions of dollars by making unusual bets on the stock market during downturn moments. Bets that move to the rhythm of Trump’s statements and that no one could have predicted; no one except those with inside information. This is the phenomenon of ‘insider trading’.
Yesterday a user on the social network X shared a tweet showing that someone had opened a position buying futures for no less than 20 million. In other words, someone bet 20 million yesterday that the price of oil would rise. Today the market opened, indeed, with a 3% rise and Brent crude remains above $100 per barrel.
Of course, insinuating that the President of the United States is using the war in Iran to scoop up insider information about national security on the stock market isn’t a pleasant assertion, and the Administration denies it: “All federal employees are subject to the government’s ethical rules, which prohibit using non-public information to gain economic benefits,” said Kush Desai, a White House spokesperson.
The White House’s legal adviser, David Warrington, stated that Trump does not participate in deals that could compromise his constitutional responsibilities. But the reality is that thousands and thousands of oil futures contracts are being negotiated for hundreds of millions of dollars at suspiciously opportune moments.
Chart: Investing
But this is far from the first time it has happened. On March 23, something very similar occurred: exactly 15 minutes before Trump posted on his social network that they had held “very productive” discussions and that attacks on Iran’s energy infrastructure would be postponed, there was an unusual spike in activity: Brent and WTI crude oil futures contracts worth more than $760 million were traded.
After the announcement, oil prices fell by about 14% within minutes, dropping from around $112 to $97 per barrel. Analysts suggest that those who executed these insider bets would have realized tens of millions of dollars in near-instant profits.
The Nobel Prize-winning economist, Paul Krugman, has labeled it as a betrayal: “We have another word to describe scenarios where people with access to confidential national-security information—such as plans to bomb or not bomb another country—exploit that information to gain profits,” Krugman wrote in a Substack post on Tuesday. “That word is betrayal.”
The problem is that no one has proof of it. Yet.
Images | Pexels
