(Kitco News) - Geopolitical uncertainty doesn’t take the weekend off, and neither will gold and oil futures as the CME prepares to launch 24/7 trading.
The world’s largest derivatives exchange announced Thursday evening that it would launch a smaller oil futures contract that will trade through the weekend, along with its relatively new one-ounce gold contract.
The shift to 24/7 trading comes as both gold and oil have seen extreme volatility during the Asian market open on Sundays. This is the first opportunity traders have as they react to events and news announced during the weekend. Specifically, the uncertainty surrounding peace agreements in the Iran War can create significant volatility at the market open.
Because futures markets are closed from Friday evening to Sunday evening, some traders have turned to cryptocurrency markets and the use of gold-backed tokens to hedge some of the weekend market risks.
"Traders are increasingly looking to diversify their portfolios across commodity markets in the face of geopolitical uncertainty," said Derek Sammann, CME Group Senior Managing Director and Global Head of Commodities Markets. "Our new WTI and Gold futures provide regulated products that are right-sized and available 24/7, ensuring traders can manage exposure whenever news breaks."
The new smaller WTI crude oil futures will be 1/10th the size of CME Group's existing Micro WTI futures. The CME added that the 10-Barrel WTI contract will be cash-settled.
The CME launched its one-ounce gold futures contract in January 2025, and the smaller size was specifically targeted toward retail traders. The exchange said that it has seen solid activity in its smallest gold contract so far this year, with a daily average volume of about 90,000 contracts.
The one-ounce contract is also cash-settled.
Gold futures will start trading through the weekend on July 26 and oil futures will start trading 24/7 on August 30.
