Top exchange executives, including those of CME Group and TMX Group, have spoken out against possible US government intervention in the oil futures market. Their concerns come amid soaring energy prices following the conflict with Iran. The comments came after reports that the US Treasury Department is considering measures to deal with rising prices. On Wednesday, the US government announced the release of 172 million barrels of oil from its strategic petroleum reserves.
“Markets don’t like it when governments intervene in oil prices,” CME Group CEO Terry Duffy said during a recent panel discussion. CME Group, the world’s largest derivatives exchange, is among the US exchanges trading energy futures. The White House and the US Treasury Department have not yet responded to requests for comment on the matter.
An anonymous CEO of another leading exchange echoed similar sentiments, warning that US Treasury intervention could worsen the situation. If energy prices continue to rise, such an action could cost the government dearly. Oil prices rose nearly 5 percent on Wednesday due to attacks on ships in the Strait of Hormuz, raising fears of a supply shock.
TMX Group CEO John MacKenzie commented on potential government interventions, saying ‘I usually find that those things have unintended consequences.’ He added that intervention could create a new problem while trying to solve the original problem, suggesting that “the market will solve it by itself.” TMX Group operates the Toronto Stock Exchange, facilitating trading in various securities. CME Group facilitates risk management, enabling businesses worldwide to address uncertainty.
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