White House Warns of Insider Trading Risks Following Suspicious Oil Bets

U.S. administration warns against insider trading amid suspicious geopolitical transactions.

The U.S. administration has cautioned its staff against using non-public information for trading on financial markets amid suspicious transactions linked to geopolitical events, reports Reuters. 

Trigger: Trades Before Iran Announcements

According to the agency, an internal memo was circulated on March 24 following a series of unusually precise trades in the oil market. These involved bets of approximately $500 million on Brent and WTI futures, placed just minutes before Donald Trump’s statement on Iran the previous day. After the announcement of halting strikes by U.S. armed forces, commodity prices fell by about 15%.

This synchrony raised suspicions of potential insider information use.

As one of the latest examples, Reuters cited a position in oil worth ~$950 million placed hours before the ceasefire announcement between Iran and the U.S. on Tuesday, April 7.

“While he [Trump] aims for a strong and profitable stock market for all, members of Congress and other government officials should be prohibited from using insider information for financial gain,” a White House representative wrote in response to the agency’s inquiry.

Prediction Markets Under Scrutiny

The situation also drew attention to crypto prediction platforms like Polymarket, where users wager on the outcomes of political and military events, reports Cointelegraph.

Analysts estimate that some traders could have earned around $1 million by accurately predicting the timing of potential U.S. actions.

This heightened concerns that participants with access to confidential information might be using such platforms for profit. In response to the incident, three bills were introduced in the U.S. Congress. The proposed provisions include: 

• banning government officials from participating in prediction market trades;
• tightening control over insider information use;
• increasing transparency of operations.

Back in April, U.S. tax experts disagreed on how prediction platform users should pay taxes on their winnings.