FCA Moves to Close Probe Into Traders Linked to 2020 Oil Market Turmoil

The UK's Financial Conduct Authority (FCA) is seeking to close an investigation into a group of commodity traders known as the "Essex Boys" after receiving a package of commitments, including a proposed £1 million donation to a government-backed hardship fund.

The traders were members of Futures Trading Facilities, a so-called trading arcade that provided independent traders with access to commodity futures markets. While each trader operated their own account, the FCA said its investigation raised concerns that some may have exchanged sensitive trading information and coordinated trading strategies.

The case is linked to the extraordinary events of April 2020, when the front-month WTI crude oil futures contract plunged below zero for the first time in history amid collapsing demand, storage shortages, and pandemic-driven market disruption. The volatility created rare opportunities for futures traders, with some market participants generating substantial profits within hours as prices swung dramatically.

According to the FCA, the suspected conduct included sharing information about intended trades and, in some cases, "in-the-moment" coordination of market actions. Such behavior could potentially undermine competition in commodity futures markets, where trading decisions are expected to be made independently.

Rather than pursuing formal enforcement action, the regulator has proposed accepting commitments from 11 traders, including annual competition-law training and restrictions on sharing trading-related information. The FCA said the £1 million contribution is likely to exceed any penalty that could have been imposed following a finding of infringement.

Several members of the group have also faced regulatory scrutiny elsewhere. In recent years, seven traders reached settlements with CME Group, accepting fines and trading bans related to their futures market activity.

The FCA stressed that the proposed resolution does not represent a finding of wrongdoing and that the traders have not admitted to breaching competition law.