A mystery trader shorted roughly $920 million in crude oil 70 minutes before Axios reported the U.S. and Iran were closing in on a deal to end the war, sending oil tumbling, according to The Kobeissi Letter.

The trade hit the tape at 3:40 a.m. ET, an unusually large block for the off-hours window. Oil prices fell more than 12% by 7:00 a.m., handing the position a roughly $125 million paper gain.

President Donald Trump later warned on Truth Social that “the bombing starts” at “a much higher level and intensity” if Iran rejects the 14-point proposal.

Pattern Of Pre-Headline Crude Shorts Draws Regulator Scrutiny

Nearly 10,000 short contracts hit the tape in minutes without a news catalyst, Kobeissi said on X.

Shortly later, the 4:50 a.m. Axios report on a memorandum of understanding sent WTI below $93 a barrel.

It is the latest in a string of similarly timed trades.

A roughly $760 million short landed 20 minutes before Iran’s foreign minister declared the Strait of Hormuz “fully open” last month, and Reuters previously reported a roughly $950 million bet placed shortly before April’s public ceasefire announcement.

Rep. Ritchie Torres (D-NY) has flagged roughly $2.1 billion in suspicious April trades alone, asking the Securities and Exchange Commission and Commodity Futures Trading Commission for a joint investigation.

The CFTC has reportedly opened its own probe.

Polymarket Swings

Polymarket’s US-Iran ceasefire markets bounced sharply on the Axios report, then fell back as Iran declined to confirm any deal was close.

The May 15 permanent peace deal contract spiked from roughly 5% to as high as 22% before settling near 15%, with the broader event drawing nearly $77 million in volume. A deal by June 30th is currently priced at 47%.

Ebrahim Rezaei, spokesperson for Iran’s parliament’s foreign policy and national security committee, called the Axios text “more of an American wish list than a reality”.

Iran Asserts Hormuz Control, Crude Slides

Energy majors Exxon Mobil Corp. (NYSE:XOM) and Chevron Corp. (NYSE:CVX) traded lower alongside the slide. Inverse crude ETF ProShares UltraShort Bloomberg Crude Oil (NYSE:SCO) rallied, while the United States Oil Fund (NYSE:USO) tumbled.

Chevron CEO Mike Wirth had warned Monday at the Milken Institute Global Conference that ​physical shortages in oil supply would start to appear due to the closure of the Strait of Hormuz.

Iran rolled out a new “Persian Gulf Strait Authority” to permanently regulate vessel transit through Hormuz, undercutting the optimism in the Axios report.

The Islamic Revolutionary Guard Corps navy added that safe passage would be “ensured” under new procedures, without specifying what those procedures entail.

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