5 Best Oil Trading Brokers in 2021

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Oil trading is one of the favored diversification trades of Forex traders, with oil CFDs the best option. We have evaluated the best brokers for trading crude oil to ensure you have a competitive edge from a secure and trustworthy trading environment.

Top Oil Trading Brokers

1
The ratings shown on DailyForex.com are determined by hours of research from our editorial team into over 10 factors, including account fees, deposit/withdrawal options, regulatory status, tradable assets, and more.
Best all around broker
High floating leverage + fast execution
2
The ratings shown on DailyForex.com are determined by hours of research from our editorial team into over 10 factors, including account fees, deposit/withdrawal options, regulatory status, tradable assets, and more.
Most extensive crypto derivatives offering. Choice of 250+ Crypto CFDs
Multiple funding and swift withdrawal options
Ultra-low spreads across all Crypto derivatives
3
The ratings shown on DailyForex.com are determined by hours of research from our editorial team into over 10 factors, including account fees, deposit/withdrawal options, regulatory status, tradable assets, and more.
ECN-style trading
Daily market research and Autochartist access
4
The ratings shown on DailyForex.com are determined by hours of research from our editorial team into over 10 factors, including account fees, deposit/withdrawal options, regulatory status, tradable assets, and more.
High level regulation in multiple jurisdictions
Impressive range of tradeable assets including vanilla options and gold options
5
The ratings shown on DailyForex.com are determined by hours of research from our editorial team into over 10 factors, including account fees, deposit/withdrawal options, regulatory status, tradable assets, and more.
Choice of MT4 or cTrader platforms
50% deposit bonus for new traders

FXTM, Best all-around: high floating leverage + fast execution.
Eightcap, Competitive pricing + excellent daily videos.
FP Markets, ECN trading with leverage up to 1:500.
AvaTrade, Highly regulated, choice of fixed or floating spreads.
Axiory, Negative balance protection + deep liquidity.

FXTM

5.0/5 in this category
In Summary
Best all-around: high floating leverage + fast execution

A competitive list of the best brokers allowing oil trading is incomplete without FXTM. While it only provides three oil and energy CFDs, traders get one of the best ECN cost structures. For a minimum commission of $4.00, clients get spreads from 0.1 pips while oil commences from 0.4 points. Active traders can lower their final trading costs with the Loyalty Program.

With a minimum deposit of just $10, FXTM allows maximum leverage of 1:2000. The award-winning educational program will help new traders getting started, and FXTM Invest supports retail account management. FXTM upgrades the sub-standard out-of-the-box MT4/MT5 trading platforms with six add-ons plus its FXTM Pivot Points Strategy. It also provides its proprietary mobile trading app FXTM Invest.

Eightcap

5.0/5 in this category
In Summary
Competitive pricing + excellent daily videos

Eightcap was originally founded in 2009 in Australia. The forex trader offers multiple different trading options in terms of what traders can buy and sell through use of their sites functionality. Customers can use Eightcap to trade their choice of more than 200 assets made up of nearly 50 currencies as well as a selection of cryptocurrencies, stock indices, commodities, precious metals, oil and more. Eightcap is accessible in more than 10 different languages, including but not limited to English, German, and French. Their services are available in South Africa, the British Virgin Islands, Italy, Australia, Japan, and Ireland among others.

FP Markets

5.0/5 in this category
In Summary
ECN trading with leverage up to 1:500

FP Markets is also among the best brokers for trading oil futures, with spreads starting from just 0.2 points and maximum leverage of 1:500. Oil traders have three CFDs plus natural gas. Traders get upgraded MT4/MT5 trading platforms, as FP Markets offers twelve add-ons to upgrade the sub-standard core versions to competitive trading terminals. MAM/PAMM provides retail account management services, Autochartist supports manual traders, and VPS serves automated trading solutions.

The trader-friendly cost structure starting from raw spreads of 0.0 pips for a commission of $6.00 per round lot offers another advantage, while the minimum deposit is just $100. International clients will trade with the unregulated FSC-registered subsidiary. Unfortunately, the 10,000 CFDs are available on the Iress trading platform with restricted access.

AvaTrade

4.5/5 in this category
In Summary
Highly regulated, choice of fixed or floating spreads

AvaTrade maintains competitive subsidiaries regulated by the ASIC, FSCA, BVIFSC, and FSRA, but traders should avoid the others. Besides its excellent training academy, SharpTrader, AvaTrade offers clients more than 1,250 CFDs from a minimum deposit of $100 with a maximum leverage of 1:500.

It features an average commission-free trading environment with minimum spreads of 0.9 pips or 0.13%, but oil traders have a mark-up of 0.3 points with a maximum leverage of 1:200. Five CFDs on oil and energy products plus options contracts offer an excellent choice. Traders may choose between six trading platforms and three social trading providers.

Axiory

4.5/5 in this category
In Summary
Negative balance protection + deep liquidity

Axiory remains among the top Forex oil trading brokers and provides clients with five CFDs with a minimum spread of 0.4 pips. Traders may choose between the MT4 or cTrader trading platforms. Axiory also provides Autochartist and its proprietary Axiory Strike Indicator to upgrade the core MT4 trading platform, which as a standalone version remains below average without upgrades. The minimum deposit is $50, but traders should opt for the $100 minimum commission-based alternative.

With a minimum spread of 0.2 pips and a commission of $6.00 per round lot, clients get maximum leverage of 1:400 in a competitive trading environment. The quality in-house research, the Axiory Trading Academy, and Axiory Intelligence provide new traders with superb trading tools. Axiory maintains a transparent execution and technology environment ideal for high-frequency traders.

Oil Trading Explained

Oil is a volatile commodity, and the two most traded assets are West Texas Intermediate (WTI) and North Sea Brent, both considered light sweet crude as their sulfur content is below 0.50%. Brent crude remains the global standard while WTI is more US-specific. Brent usually trades above WTI in terms of price, known as the WTI/Brent spread.

The oil trading basics are the same as trading Forex, equities, or any other asset class. An online broker offers the most convenient option to trade oil. The price of oil is volatile and influenced by geopolitical events, the economy, and the weather. Therefore, oil traders must monitor events across the pipeline. CFDs remain the best oil trading instrument offered by the best brokers for trading crude oil. It grants traders exposure to price action without purchasing the underlying asset. Since the introduction of CFDs, they became the primary trading tool for hedge funds and retail traders alike.

US and Canadian regulators do not allow CFD trading and deploy an outdated regulatory framework. Therefore, traders can transact in options, which have an expiry date after which they become worthless or futures, legally binding contracts to deliver oil. It remains one of the most popular trading assets, and its liquidity results in low spreads, ideal for scalpers and high-frequency traders. OPEC lost control of the oil market over the past decade. Russia and the US yield significant influence over price action, sometimes countering Saudi Arabian policies, the primary oil producer within OPEC, and the top global oil exporter.

Oil Trading Regulations

Traders should ensure that they trade with a regulated broker but must also consider the regulator. The ESMA in the EU, the SEC in the US, and the IIROC in Canada have strict and counter-productive rules. Despite the regulatory climate, the most significant frauds occurred in the US and Cyprus. Regulators including the ASIC (Australia), the FSCA (South Africa), the BVIFSA (British Virgin Islands), the FSC (Seychelles), the IFSC (Belize), the DFSA (Dubai), and the CIMA (Cayman Islands) remain among the most competitive and trustworthy ones, but none allow US-based traders.

Trading Crude Oil in the US

Since US traders cannot benefit from CFD trading due to SEC regulations, their best product is an oil exchange-traded fund (ETF). Futures contracts on US crude oil and UK Brent crude traded on the NYMEX, where one contract equals 1,000 barrels, is another option for more significant portfolios. The e-mini crude oil futures contract written by the CME Group offers smaller portfolios an improved asset and consists of 500 barrels of oil.

How to Choose a Crude Oil Trading Broker

Traders should look for brokers allowing oil trading from a secure and competitive trading environment. Tight spreads, low commissions, high leverage, and a volume-based rebate program ensure traders earn more per oil trade. The trading platform should support automated trading solutions and third-party upgrades to create a competitive edge.

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Crude Oil Trading Platforms

The MT4 trading platform and cTrader remain two of the best choices. The former is the most versatile one, and the latter the best out-of-the-box solution. The best brokers for trading oil futures will offer one or both. Several brokers also provide proprietary trading platforms as an alternative, but most of them support manual trading only, which suffices for new traders but is not enough for advanced ones.

Oil Trading Account Types

Oil is one of the most volatile assets, and trading from the appropriate account type allows traders to achieve improved trading results. New traders should consider a micro account, ideal for learning how to trade with deposits under $1,000. It precedes the mini and standard ones, best suited for portfolios below and above $10,000, respectively. Some provide VIP accounts that grant special non-trading-related bonuses. Not all brokers maintain a multi-tier account structure. Therefore, traders should ensure that the minimum transaction size is 0.01 lots.

Commissions & Spreads

Commissions and spreads are the primary direct trading costs. They will have the most visible impact on your trading strategy. Active traders should seek an ECN account with no mark-ups on spreads and competitive commissions no higher than $6.00 per round lot. Oil spreads should range between 0.2 and 0.3 points. A volume-based rebate program will lower final trading costs, and I highly recommend a broker that offers one.

What Are Margins & Leverage?

Margin refers to a percentage amount a trader needs to pay to take a position. For example, if a broker has a 5% margin requirement, a $500 position requires $25 capital. Leverage represents a ratio that defines the margin requirement. Competitive brokers offer 1:500, meaning a $500 trade requires $1 in margin capital. Risk management remains critical to margin and leverage trading.

FAQs

What does an oil broker do?

An oil broker offers trading instruments for oil. Depending on what is available, an oil broker also facilitates the storage and delivery of physical goods, i.e., the barrels of oil purchased.

How much do oil brokers make?

It depends on various factors – some out of their control – making an estimate rather challenging. The majority average somewhere between $30,000 to $70,000 in commissions, while top brokers can easily crack seven figures.

How do you buy oil trades?

An online broker remains the most convenient way to buy oil trades. There are countless oil trading brokers and Forex oil trading brokers catering to the rise in demand.

Can you make money trading oil?

Yes, you can make money trading oil. The same as with all other asset classes applies. Education, knowledge, patience, discipline, and capital remain the primary ingredients to succeed as a trader.

Huzefa Hamid

I’m a trader and manage my own capital. I trade the major Forex pairs, some Futures contracts, and I rely entirely on Technical Analysis to place my trades. Today, I am also a Senior Analyst for DailyForex.com. I began trading the markets in the early 1990s, at the age of sixteen. I had a few hundred British pounds saved up (I grew up in England), with which I was able to open a small account with some help from my Dad. I started my trading journey by buying UK equities that I had read about in the business sections of newspapers. The 1990s were a bull market, so naturally, I made money. I was fortunate enough in my early twenties to have a friend that recommended a Technical Analysis course run by a British trader who emphasized raw chart analysis without indicators. Having this first-principles approach to charts influences how I trade to this day.