The oxidation of isobutane in the presence of a novel, soluble catalyst of the formula Fe.sub.3 O(Pivalate).sub.6 (MeOH).sub.3 Cl is disclosed. Tertiary-Butyl alcohol, tertiary-butyl hydroperoxide, and acetone are produced. A significant increase in isobutane conversion is obtained without a large decrease in selectivity to tertiary-butyl alcohol and tertiary-butyl hydroperoxide using a small amount of catalyst. Tertiary-butyl alcohol is useful as a gasoline additive and tertiary-butyl hydroperoxide is used for the production of propylene oxide. Acetone has a variety of uses as well.