From a Jerry Can to Tankers: The Traders Who Built Environmental Markets — Owain Johnson (CME Group)

In this episode of This Week in Carbon, host Rene Velasquez sits down with Owain Johnson, Managing Director and Global Head of Research and Product Development at CME Group, the man who has literally written the book on commodity benchmarks, and whose forthcoming title, 40 Classic Trades in Environmental Markets, traces the history of carbon, biofuels, biomass, and water markets through the people and deals that shaped them.

Owain has spent his career studying how markets are built, how benchmarks become trusted, and how traders manage risk when the world refuses to behave predictably. He previously led energy research and product development at CME, served as Managing Director of the Dubai Mercantile Exchange, and covered Asian energy and commodity markets from Singapore.

This is a rare conversation; part market history, part trading psychology, part argument for why markets remain the best tool we have for the climate transition.

Key topics covered:

• The "believers" vs. "non-believers" `: the two types of people who end up in environmental trading, and what that split reveals about how these markets work
• Why legal backgrounds are surprisingly common among the best environmental traders and what knowing the regulation gives you that most traders don't have
• The true origins of environmental markets: the US acid rain (SOx/NOx) scheme of the early 1990s and how John Henry and Dr. Richard Sandor built the model everything else was built on, long before Brussels got involved
• Brazil's journey from ethanol importer to the Saudi Arabia of biofuels and what that transformation tells us about market design
• The Murray Darling Basin water market: why the financialisation of water is controversial and why getting the design right makes it one of the best examples of markets allocating a scarce resource properly
• Why reputation and integrity are the most important currencies in environmental trading: "I can come back from a losing trade — but I can't come back from losing my name in the market"
• The stress of trading — teeth grinding, sleepless nights, self-worth tied to a daily P&L — and how the best traders manage it
• The boom-and-bust problem: what environmental markets urgently need to learn from traditional commodities, and why institutions exiting and re-entering the space destroys value for everyone
• The "trading desk as a tripod" principle: why a minimum of three working strategies is the floor, not the ceiling
• The West Africa solar story: why farmers in a remote community wanted a forward curve more than electricity and what that tells us about the miracle of modern finance
• Omar El Nemar and the first Egyptian onshore carbon trade building a national carbon ecosystem from the ground up with peasant farmers in the upper Nile

A sweeping, human conversation about the people, the trades, and the ideas behind markets that most people have never heard of — and why those markets matter.

🎧 Listen now on Spotify, Apple Podcasts, YouTube, and more.