CFTC seeks comment on 24/7 energy futures trading, perpetual contracts

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CFTC seeks comment on energy futures

Highlights

The CFTC has launched a consultation seeking comment on extending energy futures to 24/7 trading and potential listing of perpetual energy contracts.
The agency will collect written comments within 30 days of publication in the Federal Register to evaluate risks and market impact of these changes.
The review focuses on how 24/7 trading and new contract designs may affect risk management, settlement practices, and safeguards in energy derivatives markets.

Consultation covers trading hours and contract design

As reported by the Commodity Futures Trading Commission, the agency has issued a request for comment on two related developments in energy derivatives markets, the extension of standard futures contracts to 24/7 trading and the possible listing of perpetual contracts referencing physically delivered or storable energy commodities.

CFTC Chairman Michael S. Selig says a clear, data-driven record will help the Commission understand the implications of longer trading hours and new contract designs as registered entities expand market access. He says the request reflects the Commission’s effort to support responsible innovation while preserving protections against manipulation and market disruption.

The consultation is divided into two sets of questions. One focuses on extending standard futures contracts, including energy futures, to a 24/7 schedule without changing their fixed expiration, while making material economic changes to delivery or settlement terms. The other focuses on perpetual contracts when they reference physically delivered or storable energy commodities.

Implications for energy derivatives oversight

The Commission says it intends to use the information and comments it receives to deepen its understanding of how these developments could affect the market. The review points to growing regulatory attention on how product design and nearly continuous trading may alter risk management, settlement practices and safeguards in energy-linked contracts.

Written comments must be received within 30 days after the request for comment is published in the Federal Register. The process gives market participants, exchanges and other stakeholders a defined window to weigh in before the regulator assesses possible next steps.

In our earlier article on a $97.1 million oil-storage investment fraud case, we covered how prosecutors said investor funds tied to purported storage deals in Rotterdam and Houston were routed through dozens of bank accounts and multiple cryptocurrency accounts to obscure the money trail. We also noted that the defendant received a five-year sentence for conspiracy to commit money laundering, alongside forfeiture and restitution measures that highlighted how commodity-linked narratives can intersect with complex financial and crypto payment channels.

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