Top exchange executives, including those from CME Group and TMX Group, are voicing opposition to potential U.S. government intervention in the oil futures market. Their concerns arise amid escalating energy prices following the conflict involving Iran. These comments follow reports that the U.S. Treasury is considering measures to combat rising prices. On Wednesday, the U.S. government announced a release of 172 million barrels of oil from its strategic petroleum reserve.
Terry Duffy, CEO of CME Group, stated that ‘markets do not like it when governments intervene on oil prices’ during a recent panel discussion. CME Group, the world’s largest derivatives exchange, is among U.S. exchanges trading energy futures. The White House and the U.S. Treasury Department have not yet responded to requests for comment regarding the matter.
An anonymous CEO of another leading exchange echoed similar sentiments, warning that U.S. Treasury intervention could worsen the situation. Such action could create substantial losses for the government if energy prices continue to climb. Oil prices surged nearly 5% on Wednesday due to attacks on ships in the Strait of Hormuz, intensifying fears of supply shocks.
John McKenzie, CEO of TMX Group, remarked on potential government interventions, stating that ‘I usually find those things lead to unintended consequences.’ He added that intervention could create a new problem while attempting to solve the initial one, suggesting that ‘the market will sort this out itself.’ TMX Group operates the Toronto Stock Exchange, facilitating trading in various securities. CME Group facilitates risk management, enabling businesses worldwide to offset uncertainty.
