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CFTC Halts CME Group's Launch of 24/7 Crude Oil Futures Trading
Summary
The U.S. Commodity Futures Trading Commission has blocked CME Group's plan to introduce round-the-clock trading for crude oil futures, citing procedural issues and an ongoing public comment period.
The U.S. Commodity Futures Trading Commission (CFTC) on Thursday blocked a plan by CME Group (NASDAQ:CME) to launch round-the-clock trading for its crude oil futures contracts. The regulatory intervention halts the introduction of the new contract, which was scheduled to begin trading on Friday.
Regulatory Action
The CFTC's decision follows an attempt by CME Group to self-certify the new contract on Wednesday. The commission stated that this action was taken while a public comment period regarding the expansion of standard futures contracts to continuous trading remains active.
This move puts a hold on a key strategic initiative for the world's leading derivatives marketplace. CME Group had previously announced its plans in June to offer continuous trading for certain crude oil and gold futures contracts, contingent on a regulatory review.
Procedural Conflict
AdThe CFTC highlighted a conflict in the exchange's approach to gaining approval. According to the regulator, exchanges have two distinct pathways for listing new contracts:
- Self-certification: A faster process where the exchange certifies that the contract complies with regulations.
- Request for review and approval: A more formal process where the commission conducts a full review.
The commission noted that CME Group had submitted filings under both provisions simultaneously, though as separate submissions. The halt suggests the regulator is prioritizing the formal review and public comment process over the exchange's self-certification attempt.