The Commodity Futures Trading Commission will begin assessing the financial risks associated with climate change, Commissioner Rostin Behnam said Wednesday at a meeting of the agency's market risk advisory committee.

"Assessing climate-related market risk must be a priority — and it must start now," said Mr. Behnam, who sponsors the CFTC's risk committee. He announced formation of a subcommittee to examine climate-related financial-market risk and possible steps to mitigate it, with the help of experts from relevant disciplines.

Mr. Behnam noted that market regulators in other countries, some of whom were represented at the risk committee meeting, are taking steps to assess and mitigate climate change financial risks, and the U.S. "must also demand action from all segments of the public and private sectors, including this agency." If not, commodity markets and the financial markets that support them will suffer, along with economic growth and rural communities, he said.

The Financial Stability Board's Task Force on Climate-Related Financial Disclosures is working to provide data for market participants on how climate-related risks are assessed, priced, disclosed and managed, and other regulators "have already begun taking important steps to address the impacts of climate change on financial systems," including the Network for Greening the Financial System, a group of more than 40 central banks and supervisors that includes the European Central Bank, the World Bank and the People's Bank of China, he said.

Along with the impact of extreme weather events on people, "the economic element is also just as real. Risk exposures to insurance providers, asset managers, pension funds, commercial and retail banks — all users of derivatives markets — to price and shift risk, cannot be understated," he said.