Trump risks 'biblical disaster' with new reaction to 'panic situation': oil industry giant
A global finance insider warned the Trump administration against making risky moves to bring down oil prices in response to Iran's threats to the global supply chain.
Terry Duffy, chief executive of CME Group, which operates the exchange where U.S. oil futures are traded, told other industry insiders this week at a conference that the administration risked a "biblical disaster" if officials attempted intervene in the derivatives markets during President Donald Trump's war with Iran, reported Financial Times.
“Markets do not like it when governments intervene in pricing,” Duffy told the conference in Boca Raton, Florida. "Such a move would risk a 'biblical disaster' if investors lost confidence in markets to set the price of critical commodities," FT added.
The U.S. Treasury Department is reportedly considering various measures to bring down spiking oil prices, including intervention in the futures market, and the administration announced the release of millions of barrels of oil from the strategic reserve to hold off a price shock.
"The administration could pursue other options to shelter U.S. consumers, such as temporarily suspending federal taxes on gasoline, relaxing environmental rules on fuel or temporarily banning U.S. oil exports," FT reported.
A series of large, unexplained trades in recent days set off rampant speculation among investors that the Treasury Department was selling off crude futures, but a person familiar with Treasury Secretary Scott Bessent said the agency had not intervened in oil markets.
“The idea of the U.S. Treasury selling front-month crude futures” was getting “more attention than usual," wrote analysts for Rapidan Energy Group. “Given the current panic situation we cannot completely rule it out."
The Treasury Department declined to comment on the speculation, but spokesman for the Department of Energy said it had not been involved in oil derivatives trading or advising other government agencies on that course of action.
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