CFTC investigates suspicious crude oil futures trades before Trump's Iran policy shift

The top U.S. derivatives regulator is investigating a series of suspiciously well-timed crude oil futures trades that occurred just before a shift in Trump's Iran war policy, according to people familiar with the matter.

The U.S. Commodity Futures Trading Commission (CFTC) is leading the investigation into oil futures trades on platforms of CME Group Inc. and Intercontinental Exchange Inc., the sources said. Both exchanges have been asked to provide relevant data.

The CFTC is looking into at least two instances over about two weeks where trading volume suddenly surged ahead of major policy announcements, the sources said. The regulator has requested exchange data including "Tag 50" operator IDs, which identify the entities behind the trades.

The unusually large trading volumes in recent weeks have raised concerns about possible misuse of material non-public information. At the start of the conflict, historic disruptions to Middle East oil shipments sent prices soaring. In subsequent weeks, prices gyrated wildly as markets speculated on when tanker traffic through the Strait of Hormuz would resume.

Two Democratic senators have urged the CFTC to investigate potential violations, intensifying scrutiny of these suspiciously timed trades. The White House issued an internal memo last month warning staff not to use sensitive information to trade in financial markets or on event betting platforms.