CFTC Charges Traders Controlled By World's Largest Tanker Company With Oil Price Manipulation After Making "Shitload" Of Money

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Tue, 05/24/2011 - 17:00 | 1306698 mayhem_korner
mayhem_korner's picture

Ya hafta admire the artistry of corruption...

Tue, 05/24/2011 - 17:20 | 1306754 Rainman
Rainman's picture

...yup. Cap a couple small fry to take heat off the Bigs. That Barry meant what he said about rounding up the evil specs....cough/cough

Tue, 05/24/2011 - 20:27 | 1307325 Downtoolong
Downtoolong's picture

Yep, and these dupes even got it backwards. The real money comes from manipulating the futures price index to affect the purchase and delivery price of physical oil you are managing (cough again) for your clients. That’s how the real shyster traders do it on Wall Street, aka, J. Aaron (Goldman), Morgan Stanley, Phibro (ex Citi), and JPM.

Tue, 05/24/2011 - 23:11 | 1307767 silberblick
silberblick's picture

Click below to see a visual graph of Bankster's dirty needs arranged according to Abraham Maslow's hierarchy of needs:

Tue, 05/24/2011 - 17:08 | 1306713 cossack55
cossack55's picture

Were any of the crew carrying Norfed dollars?

Tue, 05/24/2011 - 17:11 | 1306732 AndrewJackson
AndrewJackson's picture

This makes me feel better about not getting offered a job to begin BP's trading program.

Tue, 05/24/2011 - 17:19 | 1306745 fuu
fuu's picture

$50,000,000? Seriously?


When do we get the criminal investigation into the $700,000,000,000 Theft And Rape Project?

Tue, 05/24/2011 - 19:46 | 1307200 Rodent Freikorps
Rodent Freikorps's picture

Crime pays.

Tue, 05/24/2011 - 20:50 | 1307378 Amish Hacker
Amish Hacker's picture

IRilly. "The scheme yielded more than $50 million in unlawful profits." What a joke. In the QE bordello, you can find that much in the sofa cushions.

Tue, 05/24/2011 - 17:16 | 1306746 tmosley
tmosley's picture

You sure it wasn't Waddle and Reed?

Tue, 05/24/2011 - 17:18 | 1306749 Ecoman11
Ecoman11's picture



The war is on physical stockpiling. Read how the UK Parliament openly admits there is a "Monopoly Supplier" in the metals market.


So now hoarding and stockpiling is illegal but you are allowed to trade the soon-to-be 1000/1 paper market. Just don't touch the physical.


Tue, 05/24/2011 - 17:20 | 1306761 RobotTrader
RobotTrader's picture

FRO was destroyed today, down 6%, now at a 3-year low.

Nobody wants to invest in tanker companies when you can make 17% in a shoe company like DSW making new record highs.

And don't get me started on CMG, NFLX, LULU, etc.

Tue, 05/24/2011 - 17:28 | 1306782 Robslob
Robslob's picture

Poor Robo the sensationalist...

"FRO was destroyed today, down 6%, now at a 3-year low."

Interpretation: FRO fell 6.37%  / $1.28 and is getting "destroyed" After Hours for another 1% or .20 cents....

Tue, 05/24/2011 - 17:41 | 1306824 CPL
CPL's picture

They could always get whacked like DRYS.  However the fundementals of the company remain the same as always.  They have floating storage that can go to any point on the globe.


If you want to see funny.  Go look up Krispy that's funny.  Donuts and coffee are worth 8 bucks.

Tue, 05/24/2011 - 18:15 | 1306929 Cruel Aid
Cruel Aid's picture


You are an IBD guy, maybe Marketsmith(Q: Worth the money?).

Did CNTF pop up on your radar. Better than Gold and not worthy of earnings list.


Tue, 05/24/2011 - 17:22 | 1306765 PaperBear
PaperBear's picture

"they had no commercial need for crude oil" - can the same argument be made regarding silver ?

Tue, 05/24/2011 - 21:15 | 1307457 MrFriskles
MrFriskles's picture

I know I do a lot of hobby soldering with .999 fine. Pipes, circuit boards, etc .... right?

Tue, 05/24/2011 - 17:25 | 1306766 Raymond Reason
Raymond Reason's picture

Just like all law enforcement.  Out writing speeding tickets while the town is gang banged. 

Tue, 05/24/2011 - 17:26 | 1306776 cougar_w
cougar_w's picture

I once posted on ZH that oil companies manipulate prices for crude and distillates, and someone who posts here regularly said I was an idiot and it's all market forces.

Hey, are you still on ZH? Then if you are reading this: Fuck the fuck off you witless oil company fluffer troll.

Okay, to be fair this is more than just the oil primaries flogging prices. But still fuck off you lying, prostituting douche.

There. I feel much better.

Tue, 05/24/2011 - 17:37 | 1306805 tmosley
tmosley's picture

To be fair to the "douche", this looks a lot more like scapegoating to me.  The administration is trying to beat down the price by driving out all the long side specs.

Wed, 05/25/2011 - 02:31 | 1308073 Tremain
Tremain's picture

I’m with tmosley don’t forget a lot of the money was made by shorting WTI:

Dyer said in a September 2007 email to other Parnon/Arcadia traders that there was a "shitload of money to be made shorting" the New York Mercantile Exchange West Texas Intermediate calendar spreads

Tue, 05/24/2011 - 18:31 | 1306976 breezer1
breezer1's picture

you need to spend a little time over at banzai7's site.

Tue, 05/24/2011 - 17:27 | 1306779 silvertrain
silvertrain's picture

thank goodness..For a minute there I thought gas prices were going to stay high all summer..This brings the family vacation back in the picture now..Just in time for Memorial day weekend...

Tue, 05/24/2011 - 17:30 | 1306780 Catullus
Catullus's picture

I missed the part about this being illegal other than the CFTC just making up the market manipulation rules as they go.

Tue, 05/24/2011 - 17:39 | 1306818 NotApplicable
NotApplicable's picture

That's what I got from the article as well.

Are traders not supposed to trade now? Or was it just arbitrage that was outlawed?

Tue, 05/24/2011 - 17:47 | 1306847 Hansel
Hansel's picture

Agreed.  Don't all traders "manipulate" the price?  This is garbage, especially this,

Their attempt to control the direction of the market worked in January and March 2008, the CFTC said, but failed in April...

So the CFTC is going to pick and choose which trades were manipulation?  What a waste of resources this suit is.

Tue, 05/24/2011 - 17:32 | 1306785 belogical
belogical's picture

I love the part about amassing a huge WTI position without physical need for it. If that is the case then what in the world do they say about silver. Why on earth would a handful of banks amass a huge short position. There can not be a logical reason for it other then manipulation of price, which is what we just experienced 

Tue, 05/24/2011 - 17:30 | 1306792 CPL
CPL's picture

It took them five years to catch up with old news?

Tue, 05/24/2011 - 17:55 | 1306864 SILVERGEDDON

JP Morgan Chase's 2785 short contracts (at last look, dominating the top 15 institutional holders of short position contracts by a factor 10 to 1!) is a coincidence. Anyone thinking they want to manipulate the market should have their pee pee whacked with a big stick! As for the rest of you - go buy the physical while it is under $40.00 per ounce - not gonna be there for long, and it will be a nostalgic look back in time some day for the old "Well, I remember when" speech you wind out for your grandchildren.

Tue, 05/24/2011 - 18:02 | 1306885 Tracerfan
Tracerfan's picture

The crude oil market is too large for these traders to move prices materially.

I call BS.

This is a naked attempt to flush participants out of the market.

Less volume means more price volatility, including spikes.


Tue, 05/24/2011 - 18:05 | 1306890 Tracerfan
Tracerfan's picture

Blatant attempt to manipulate prices by the Feds.

Doomed to failure.

Tue, 05/24/2011 - 18:02 | 1306898 Dolemite
Dolemite's picture

Oil poised to take a leg lower?

Stocks certainly are

Tue, 05/24/2011 - 18:13 | 1306934 JW n FL
JW n FL's picture

***** "Now if only you would exhibit the same fervor in pursuing decade old charges of comparable but inverse price manipulation allegations in the precious metals space everyone would be very happy." *****


Everyone knows the Oil is turned into Gold or Guns! the price of both to be controled by the U.S. Tax Payers Contributions.

Tue, 05/24/2011 - 18:18 | 1306940 ILikeBoats
ILikeBoats's picture

Baron Jamie Dimon and Lord Blankfein politely smile at the thought of being caught with $50 million in pocket change stolen from the nation's vending machines.  Why even bother with such a paltry amount?

Tue, 05/24/2011 - 18:18 | 1306941 honestann
honestann's picture

Hey you frauds at CFTC.  Why not get to the bottom of what's happening with silver.  What?  You have orders from the predators-that-be to suppress "monetary metals"?  Oh, thought so.

Tue, 05/24/2011 - 19:02 | 1307074 apberusdisvet
apberusdisvet's picture

The CFTC will go after these guys since the gas price is important to Obama's re-election.  10% (listed, but phony) unemployment plus $5 gas would be a real bummer.  Obama is as much of a bankster tool as Gensler. et al.

Tue, 05/24/2011 - 20:18 | 1307122 strannick
strannick's picture

Recently the CFTC went to Congress asking for more $$ so as to better regulate commodities, even though the chronically useless and absurd CFTC has only 1 prosecution of maniuplation in its 35 year existence.

The CFTC's record of doing absolutely nothing is understandable when one considers the revelation from retiring CFTC Judge Painter, who confessed that when he began his career, the CFTC Commisioner at the time told him to never rule in favour of a plaintiff.

Here is a tidbit from CFTC Commisioner Micheal Dunn, in which Dunn admits to the utter ineffectiveness of the CFTC as anything but a bumbling, fillibustering bureaucracy.

“To date, CFTC staff has been unable to find any reliable economic analysis to support either the contention that excessive speculation is affecting the markets we regulate or that position limits will prevent excessive speculation,” 

Tue, 05/24/2011 - 20:36 | 1307342 Smiddywesson
Smiddywesson's picture

Well look at the big brain on Strannick.  I didn't know any of that stuff.  You have justified my time spent tonight and have been logged in the notebook of people to listen to.



Tue, 05/24/2011 - 19:39 | 1307183 Central Bankster
Central Bankster's picture

So trading oil is now "manipulation"?  How is going long oil, then selling it and going short, manipulation?  Its getting to the point where you have to be insane to even bother trading anything in the US, for fear that they come after you.  That is, unless you work for the government, then manipulation is A OK.

Tue, 05/24/2011 - 19:59 | 1307231 penisouraus erecti
penisouraus erecti's picture

Nick Wildgoose - too bad not Richard (Dick) Wildgoose - think of the comedic possibilities with that one.....


Tue, 05/24/2011 - 20:08 | 1307269 Hotspur
Hotspur's picture

Total waste of time. They're clearly off on a Wildgoose chase.

Tue, 05/24/2011 - 20:15 | 1307283 Smiddywesson
Smiddywesson's picture

"We manipulate bitchezz, you cough up the dough."

                         - Ben Chairsatan

Tue, 05/24/2011 - 20:23 | 1307304 Downtoolong
Downtoolong's picture

amassing "a sufficient quantity of physical WTI to be delivered the next month at Cushing to dominate and control WTI supply even though they had no commercial need for crude oil," it said.

What the hell, J. Aaron (Goldman), Morgan Stanley, Phibro (ex Citi), and JPM have taken massive positions in whole tanker loads of physical crude oil for years. Someone tell me what use these traders have for crude oil. Last I checked, there wasn’t a single refinery on Wall Street.

Tue, 05/24/2011 - 20:28 | 1307329 chistletoe
chistletoe's picture


Once you wipe off the lipstick, this action, along with the action the other day

on margin limits, is nothing more than an elaborate scheme to fix prices.

Ultimately, "the powers that be" have only two choices:

1 is higher prices.  2 is spot shortages.

Gas lines, here we come.

(kudos to Tracerfan.  The USA alone consumes 19 million barrels/day;

that's $1.9 billion/day ... not too many single "traders" have deep enough pockets

to move the spot price even one penny ....)

Tue, 05/24/2011 - 20:34 | 1307338 nmewn
nmewn's picture

LOL!!!...women & children hurt the most, again (VLCCF)

Tue, 05/24/2011 - 21:21 | 1307466 MrBoompi
MrBoompi's picture

That ain't no shit. This is like catching a kid stealin a pack of twinkies.

Tue, 05/24/2011 - 21:36 | 1307522 palmereldritch
palmereldritch's picture

And the traders' lawyers weigh in


Tue, 05/24/2011 - 21:39 | 1307531 palmereldritch
palmereldritch's picture



Tue, 05/24/2011 - 23:00 | 1307750 Coldfire
Tue, 05/24/2011 - 23:54 | 1307850 AldoHux_IV
AldoHux_IV's picture

Blatant market manipulation everywhere, profiting off it too, inflicting a lot of suffering to the real economy in the meantime-- the realization of the fraud from the peasantry: priceless.

By the way, it seems like if the CFTC actually wanted to create a fair and free market it wouldn't be that hard: revamping of the commercial hedging (as this has been a blanket for outright manipulation and now has become some business' main source of income), position limits, and a reclassification of the players in the commodity markets.

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