LONDON — A massive $920 million crude oil short position was placed in the early hours of Wednesday, May 6, 2026, just 70 minutes before reports emerged that the United States and Iran were on the verge of a 14-point memorandum of understanding to end their 67-day war. The timing of the trade—described by financial analysts as “unusually large” for that time of day—sparked immediate accusations of insider trading and raised fresh questions about the Trump administration’s handling of sensitive diplomatic information.

The trade, equivalent to nearly 10,000 futures contracts, was executed at 3:40 a.m. ET when global crude markets were thinly liquid. Seventy minutes later, at 4:50 a.m., Axios reported that the White House believed the US and Iran were close to agreeing to a one-page framework designed to restart nuclear negotiations and gradually reopen the Strait of Hormuz. By 7:00 a.m., oil prices had plummeted 12%, allowing the trader to secure profits estimated at $125 million in hours—a windfall that has intensified scrutiny over whether officials or allies exploited non-public information.

While the administration has not confirmed any wrongdoing, the sequence of events has reignited debates about market manipulation during wartime, particularly as the conflict has already seen multiple instances of traders profiting from geopolitical developments. Critics, including lawmakers and financial commentators, are demanding investigations into whether the administration’s erratic diplomatic signaling is being weaponized for financial gain.

How a $920 Million Oil Short Bet Became the Latest Insider Trading Scandal

The trade executed at 3:40 a.m. ET was not a routine market adjustment. Financial analysts, including those monitoring The Kobeissi Letter, described it as a “deliberate, high-conviction directional bet” given its size and timing. At that hour, crude oil futures markets are typically inactive, making such a large short position highly unusual unless the trader had advance knowledge of a major development.

Just 70 minutes later, Axios published an exclusive report by Middle East correspondent Barak Ravid, citing White House sources who believed the US and Iran were nearing a deal. The memorandum of understanding, described as a one-page framework, would have included:

• Restarted nuclear negotiations—a key sticking point for President Donald Trump.
• Gradual reopening of the Strait of Hormuz, easing shipping disruptions.
• Lifting of the US naval blockade on Iranian ports.

By 7:00 a.m., oil prices had dropped 12%, allowing the trader to lock in profits estimated at $125 million. The rapid price movement and timing have led to widespread speculation that the trade was made using non-public information. While the administration has not commented on the specific trade, the pattern of market activity surrounding US-Iran diplomacy has drawn increasing scrutiny.

Pattern of Profits: A History of Market Manipulation Allegations

This is not the first time traders have allegedly profited from US-Iran diplomatic signaling. In late February, bettors on prediction markets collected around $1 million by accurately predicting the timing of Trump’s war with Iran. The Financial Times reported a $580 million surge in oil futures trading just before Trump announced a pause in strikes on Iran’s energy facilities in March.

Last month, an active-duty US special forces soldier was indicted by the Department of Justice for making about $400,000 betting on Polymarket that Venezuelan President Nicolás Maduro would be removed from power—a bet allegedly placed using classified information from an operation he was involved in.

Political Fallout: Calls for SEC Investigation

Democrats in Congress have intensified calls for the Securities and Exchange Commission (SEC) to investigate potential insider trading tied to the Trump administration’s handling of sensitive diplomatic information. Senator Chris Murphy (D-Conn.) described the situation as “mind-blowing corruption,” extending beyond the war to Trump’s tariff regime, which has also caused market chaos that traders have exploited.

Former Rep. Marjorie Taylor Greene (R-Ga.), a vocal critic of Trump, took to social media to accuse the administration of using war rhetoric as a tool for insider trading. “When is everyone going to start realizing that the on-again, off-again war/peace rhetoric is really just insider trading?” she wrote. “Only a select few in the top tax bracket are benefiting from this, and the majority of you ain’t in it.”

Ethical Concerns: Profiting from War

Critics have condemned the practice of profiting from the machinations of a conflict that has already claimed over 1,700 civilian lives, according to Airwars. Fox News commentator Jessica Tarlov expressed outrage, stating, “Lives on the line so they can insider trade!”

The situation has also raised broader questions about the integrity of financial markets during wartime. If officials or allies are using non-public information to trade, it undermines confidence in the fairness of global markets—particularly in commodities like oil, which are critical to global economies.

What Happens Next?

The SEC has not yet commented on whether it will open an investigation into the latest trade or the broader pattern of market activity surrounding US-Iran diplomacy. Though, given the volume of allegations and the high-profile nature of the case, We see likely that regulators will scrutinize the timing and source of the trade.

In the meantime, the White House has not provided clarity on how diplomatic signals are communicated to market participants. Without transparency, the cycle of speculation, trading, and profit-taking is likely to continue—further eroding trust in both the administration’s diplomatic process and the fairness of financial markets.

How to Follow Updates

For the latest developments:

• Monitor SEC statements for potential investigations.
• Track Axios and Reuters for diplomatic updates.
• Follow financial regulators like the Commodity Futures Trading Commission (CFTC) for market integrity reports.