Market Speculation: US Treasury Department Has Taken Action! CME President: If the US Intervenes in Crude Oil Futures, It Would Have "Catastrophic Consequences"

As the US-Iran conflict continues to drive up oil prices, speculation about whether the US government has quietly intervened in the crude oil futures market is spreading through the energy trading community. The head of the world’s largest derivatives exchange has issued a public warning.

Terry Duffy, CEO of CME Group, stated at an industry conference this week that if the Trump administration attempts to suppress oil prices through market intervention, it would face a “biblical disaster.”

He warned that government involvement in commodity pricing would severely erode market confidence. He emphasized that once investors doubt the fairness of key commodity prices, the consequences could be unpredictable.

CME Group operates the core exchange for US crude oil futures. It is rare for its leader to directly warn about government intervention, reflecting the current market’s high alert to policy uncertainties.

According to reports citing sources familiar with US Treasury Secretary Janet Yellen, the US Treasury has not intervened in the oil market. Last week, Wall Street Insights mentioned that the US Treasury is evaluating several schemes to lower oil prices, including direct involvement in futures markets.

On Monday, Brent crude oil prices surged to nearly $120 per barrel but then sharply reversed, falling back above $80. This unusual movement has led energy traders to widely speculate whether the US Treasury has quietly stepped in.

(US oil prices plummeted over 31% from the daily high on Monday)

Large trades of unknown origin have sparked speculation, with consulting firms unable to rule out Treasury involvement

This week, several large, opaque trades have appeared in the oil market, prompting energy traders and consulting firms to scramble for clues about the buyers or sellers behind them.

Tim Skirrow, head of derivatives at Energy Aspects, said the firm has received ongoing inquiries from clients asking whether recent large trades are led by the US government. Skirrow stated:

Our clients keep asking who the big sellers are. Market speculation suggests the sellers might be from the US Treasury.

He also pointed out that the US government has previously intervened in other markets like foreign exchange, making such speculation plausible.

Rapidan Energy Group, founded by former White House energy advisor Bob McNally, reported that the US Treasury’s plan to sell near-month crude futures is “drawing unusual attention.”

The group noted that such a move would be “unprecedented,” but given the current panic, “it cannot be ruled out.”

Market Misinterpretation from Energy Secretary’s Post, US Officials’ Statements Further Shake Confidence

Beyond Treasury intervention rumors, other actions by government officials this week have also confused oil market investors.

According to CCTV News, on Tuesday, US Energy Secretary Chris Wray posted on social media that the US Navy escorted an oil tanker through the Strait of Hormuz. The news caught the market off guard, causing a sharp drop in oil prices. However, the post was deleted within minutes, and the White House later denied that the Navy had escorted any ships through this strategic waterway.

John Evans, analyst at London-based PVM Oil Associates, wrote in a report on Thursday that it remains unclear whether Wray’s post was “another complete mistake or a more serious deliberate manipulation.”

Wall Street Insights mentioned that on Thursday, US Energy Secretary Wray stated that the US military is “not yet ready” to implement escort operations before the end of the month.

These series of events, combined, mean that oil market participants must contend with both geopolitical and policy uncertainties when assessing supply prospects, making short-term volatility difficult to stabilize.

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