If you plan to look for opportunities in crude oil's price movement, there's nothing better than trading in a good broker with low spreads for oil commodities.
Generally, there are several types of crude oil to watch for, but Brent and WTI are the world's two major types that come on top. Brent crude oil is extracted from the North Sea while WTI is extracted in the US, primarily from Texas.
Right now, Brent accounts for two-thirds of global oil pricing. Besides knowing the differences between Brent and WTI, deciding how to trade them is also important. In that case, oil can be traded as futures, spots, and even CFDs.
Some of the best examples for crude oil brokers are:
- FBS: Equipped with impressive spread of 0.03 for XRB/USD and 0.04 for XTI/USD.
- IC Markets: Spread starts from 0.020 pips with an average of 0.027 pips.
- FP Markets: The spread for WTI is 0.04 pips, while Brent's minimum spread is 0.03 pips.
- AvaTrade: This broker has minimum spreads of 0.03 pips.
- OctaFX: WTI crude oil spread starts from 0.6 pips meanwhile the Brent crude oils spread starts from 1.1 pips.
- Admirals: The crude oil spread starts from USD 0.05 pips.
These crude oil brokers have different features and trading conditions that traders should know. This might affected how they trade the instruments. Here is how these broker provide crude oils to their clients.
Where to Trade Crude Oils
Aside from ensuring low spreads, a good broker for oil trading should possess other great qualities in terms of leverage, platform, and order executions. Among many brokers who claim to be the best, there are only a few that really stand out. Here are some of them:
FBS
FBS broker presents an exceptional opportunity for crude oil trading. With FBS, traders can engage in the dynamic world of crude oil trading, featuring popular options like Brent Crude Oil (XRB/USD) and Texas WTI (XTI/USD). The impressive spread of 0.03 for XRB/USD and 0.04 for XTI/USD make trading highly precise and cost-effective.
One of the notable advantages of trading crude oil with FBS is its flexibility, as it's available across standard, cent, and pro trading accounts. What's best is that FBS low minimum deposit requirement is just $1. With a maximum leverage of 1:3000, FBS empowers traders to amplify their potential gains.
Since 2009, the action of FBS Holding Inc. or known as FBS in the world of forex trading has been recognized by various international institutions. With clients reaching 14 million as of 2019, FBS has received the title of Most Transparent Forex Broker 2018, Best Investor Education 2017, Best Customer Service Broker Asia 2016, IB FX Program, and many others.
FBS is regulated by FSC Belize and CySEC Cyprus. This broker has been trusted by millions of traders and 370 thousand partners from various countries. Based on their data, FBS garners about 7,000 new traders and partner accounts every day. And, 80% of the clients stay in the FBS for a long time. No wonder the broker is growing rapidly due to the incredible growth in the number of clients.
Trading products offered by FBS range from forex, CFD, precious metal, and stock. For forex trading, CySEC-regulated FBS offers leverage up to 1:30 on Cent and Standard Accounts. Clients who want to try higher leverage than that can alternatively register an account under FBS Belize.
FBS spread begins from 0.5 pips for Pro account type and from 0.7 pips for Standard and Cent accounts. On a standard account, volume orders can be made from 0.01 to 500 lots. Therefore, this account is recommended for experienced traders.
Whereas on Cent Accounts, volume orders can be carried out with a maximum of 500 cent lots or the equivalent of 5 standard lots. Cent Accounts involve a different level of risk. FBS recommends Cent Accounts for beginner traders. All account types support the following trading instruments: 36 Forex pairs, 8 metals, 3 energies, 11 indices, 127 stocks, 5 crypto pairs.
Before plunging into the real forex market, traders can practice with FBS Demo Account which consists of two types, i.e Standard and Cent.
FBS uses the MetaTrader 4 and MetaTrader 5 platforms. They offer them on Windows and Mac as well as Android and iOS mobile. These platforms provide a trading experience at traders' fingertips, allowing traders to progress as a trader anywhere at any time.
MetaTrader platforms also have a variety of mainstay features, including the possibility to create, buy, and use expert advisors (EA) and scripts, One-click trading and embedded news, technical analysis tools, the possibility to copy deals from other traders, hedging positions, and VPS service support.
Another advantage provided by FBS is a deposit bonus of 100% for clients who fulfill certain requirements. The process of FSCing and withdrawing funds can be run easily and quickly. Based on clients' testimonies, each process usually takes no more than 3-4 hours, except on holidays.
Traders also have the opportunity to develop a side business when trading with FBS, namely as an Introducing Broker (IB) or Affiliate. The FBS partnership system provides partner commissions that are already in 3 level positions. Only by introducing new clients to FBS according to certain procedures, traders can earn extra income.
Traders will also get trading education experience at FBS. They have prepared a comprehensive forex course. The course consists of 4 levels: beginner, elementary, intermediate, and experienced. Traders can take courses that will turn them from newbies to professionals. All materials are well-structured. Besides, FBS provides various forex analyzes, webinars, forex news, and daily market analysis that can be accessed easily on their site.
Traders can access the FBS website with many language choices. Of course, this will increasingly provide comfort for traders. Available languages include English, Italian, French, Portuguese, Indonesian, Spanish, and others. Live chat support is also provided 24 hours 7 days a week.
In conclusion, FBS is a widely known broker among retail traders around the world. It continually grows to become a preferred broker because of flexible trading conditions that enable its clients to trade with various instruments, low deposit, and other trading advantages.
ICMarkets
When it comes to the best broker with great trading conditions, ICMarkets is a good option. This Australian broker offers a flexible and easy way to gain exposure to some of the world's most popular commodities including energies like crude oils. ICMarkets allows traders to open long and short positions on WTI and Brent from platforms like MetaTrader 4, 5, and cTrader.
Right now, the spread for Brent crude oil futures as well as WTI futures starts from 0.020 pips with an average of 0.027 pips. Traders can also enjoy high leverage up to 1:500, with an average execution speed of under 40ms. They provide free low latency collocated VPS to make sure there are no requotes.
IC Markets is an online forex broker operating under the company of International Capital Markets Pty Ltd. Traders under the Australian jurisdiction are provided with the trading service of IC Markets AU that is headquartered in Australia and licensed by the Australian Securities and Investments Commission (ASIC).
On the other hand, non-Australian traders who open an account in this broker are registered under IC Markets SEY that is based in Seychelles, and regulated under the Seychelles Financial Services Authority (SFSA). The dual operation is a result of the relatively new rules from ASIC that prohibit their regulated broker to offer trading services outside Australia.
Classified as an ECN broker, IC Markets provide clients with MetaTrader 4, MetaTrader 5, cTrader as platform trading options. This broker also follows market trends to include Cryptocurrencies as one of its products, enriching its already wide selection of trading assets that include Currencies, Indices, Metals, Energies, Softs, Stocks, as well as Bonds.
The minimum deposit in IC Markets is in the middle range compared to other ASIC-regulated brokers, as it reaches $200 for every client. Market analysis materials are also prepared regularly for trading insights on IC Markets's official website, proving their competence to serve their traders with important contents created by market experts that work specifically for them.
For payment methods, IC Markets allows funding and withdrawal via wire transfer, credit card, PayPal, Skrill, Neteller, FasaPay, UnionPay, as well as Bitcoin via BitPay. The more interesting aspect from this broker is its multi-base currencies that include USD, AUD, EUR, GBP, SGD, NZD, JPY, CHF, HKD, and CAD.
As the trading technology in IC Markets is highly equipped with co-located servers and extremely low latency (especially on cTrader), the broker is widely known for its capability in hosting traders with the special needs for high-frequency trading as well as scalping.
To sum up, IC Markets is a fitting destination for active traders looking for a well-regulated broker. IC Markets is also flexible in terms of base currency and payment methods, signaling their commitment to welcome traders beyond their home country. As of late 2019, IC Markets provided their website in 18 international languages including English, Korean, Indonesian, French, Spanish, Italian, Malay, German, and Chinese.
FP Markets
FP Markets provides 1:500 leverage for their commodities trading, including crude oils. The spread for WTI is 0.04 pips, while Brent's minimum spread is 0.03 pips.
This makes FP Markets a good broker for low-spread oil trading. FP Markets provides one of the most beginner-friendly platforms, MetaTrader 4 (MT4), which is available for desktop, iOS, Android, and Mac devices. They also allow expert advisors for traders who want to try automatic commodities trading.
Keeping positions open overnight won't result in the overnight/rollover fee reducing your earnings, so you don't have to worry about it. FP Markets offers the most competitive swap rates in the industry by introducing Swaps Points in the form of a live swap rates list on the MT4 and MT5 platforms. Here are some examples:
- ACWI: -5.00 for long positions and -2.50 for short positions.
- ADAUSD: -20.00 for long positions and -20.00 for short positions.
- AGG: -5.00 for long positions and -2.50 for short positions.
AvaTrade
AvaTrade is another broker to consider for low-spread oil trading. They have minimum spreads of 0.03 pips with leverage up to 1:100. AvaTrade is a great choice for commodity traders who are very busy and prefer mobile trading.
They are known to have one of the best mobile trading tools, AvaTraderGo. This allows traders to execute trades on business trips, at the office, or on holidays. For better security, traders can use AvaProtect, a unique feature that reimburses traders for losing positions.
Avatrade can be called one of the most well-rounded brokers that support almost all trading styles. Not only allowing hedging, scalping, and expert advisor (EA), Avatrade also completes their service with One-cancels-the-other order (OCO) and AutoTrading in many variants of automated trading systems.
AvaTrade was founded in 2006, with the primary mission to empower people to trade with confidence. If traders are still confused about what is the best broker for supporting trader's trading, AvaTrade perchance option of traders, because it has been evaluated and honored for some of the industry's most remarkable financial and technological achievements that it provided to clients.
In 2019, the Dublin-based broker got achievement from Daytrading.com as The Best Forex Broker 2019. Besides, the company is honored as Best Forex Broker, Best Bitcoin CFD Trading Provider of the year, and Best Affiliation Programme in the European area.
Furthermore, for traders who have high mobility, AvaTrade provides many platforms that allow traders to trade using laptops and mobile phones. The availability of the free Autochartist tool in the platforms is the best support for both novice and experienced traders because it makes it easier for them to find trading opportunities without the need to glance at charts all day.
The Autochartist free signal is provided in Gold Account, Platinum Account, and AVA Select. By opening an account in AvaTrade, traders don't have to pay for getting a full Autochartist service. Autochartist itself is a market scanner tool that can detect trading signals from various technical perspectives.
Traders can access AvaTrade in many variants of platforms, such as AvaTradeGO, MetaTrader 4, MetaTrader 5, Automated Trading, Mac Trading, Web Trading, Mobile Trading, and AvaOptions.
In terms of regulation, AvaTrade is regarded as a superior broker because it has a lot of credible licenses. That way, even with deposits of up to ten thousand dollars, security can be guaranteed. Applying the Segregated Account system, AvaTrade is regulated by the Central Bank of Ireland (No.C53877), ASIC Australia (No.406684), JFSA Japan (No.1662), and South Africa (FSP 45984).
Can traders lose more than their deposit abruptly in the event of high volatility? AvaTrade explicitly answers no, as traders have negative balance protection.
With a minimum deposit of USD100, AvaTrade offers various leverage depending on the trading instruments; whether it is forex (starts from 30:1), indices (starts from 20:1), commodities (starts from 5:1), ETFs (starts from 5:1), or cryptocurrencies (starts from 2:1).
AvaTrade has committed to a set of values in relation to customers. Therefore, the company provides the best trading experience, offering multilingual customer service and the most sophisticated and user-friendly trading platform.
New traders can also learn forex trading in the Education tab on AvaTrade's official website. Traders will find a wide collection of articles, video tutorials, and more tools that will assist them every step of the way. It is an important requirement as the forex market might be a bit overwhelming and even scary at times, so traders need to make sure that they are fully prepared to begin trading in the real account.
There are many types of account types provided by AvaTrade. There is also an Islamic Trading Account, which is uniquely provided for Muslim Traders. Islamic account type is similar to a regular one with one key difference; it is not subject to any special fees or interests (swap-free), which sits well with the finance principles of Sharia Law.
If traders have felt confident for forex trading, traders can choose AvaTrade as an ideal choice. The minimum deposit and various platforms offered to make it a suitable destination for even beginners who would like to try forex trading for the first time.
OctaFX
OctaFX has one of the lowest spreads for oil trading. The WTI crude oil spread starts from 0.6 pips. However, the Brent crude oils spread is relatively higher than other brokers in this list since it starts from 1.1 pips.
That being said, they are still a great broker for oil trading. They don't charge round-turn commissions for commodity trading and provide good leverage of up to 1:200 to amplify traders' buying power.
Admirals
Admirals' crude oil spread starts from USD 0.05 pips. The leverage for these products is pretty high, up to 1:500. Traders can execute orders from MetaTrader platforms accessible from both PC and mobile devices.
They also allow mobile trading with the Admirals mobile app. Another reason to trade with Admirals is that this ASIC-regulated broker applies a Negative Balance Policy to protect traders from losses due to extreme volatility.
Benefits of Oil Trading
Now, the real question is, does oil trading worth all the hassle? Oil is one of the best assets to diversify any trader's portfolio. One of the reasons is that oil has a unique position in the financial markets.
It is the key resource for vehicles, planes, heating and electricity, and many more. Because the global economy depends on oil, the commodity is widely traded and one of the most liquid products in the financial market. That being said, there are several benefits traders can get from trading oil, including:
1. Better Opportunities to Trade
Crude oil offers better opportunities due to constant price fluctuations. If traders can make the most out of it, they can get substantial gains even for investments much lower than what they usually did.
In fact, plenty of successful traders gain thousands of dollars from oil trading. Some might prefer to trade oil futures with a contract so they could speculate on the prices, whether it drops or rises. But, remember that trading oil requires the right skills, knowledge of the oil price market and how it moves, and the ability to deal with the risk.
2. High Demand, Limited Supply
Right now, oil has a very limited supply while not all countries can produce their own oil to fulfill their needs. Currently, there is no substitute that can fully replace oil yet. Although there is renewable energy, it has not yet reached its full potential. This situation benefits oil investors since the price is highly likely to maintain its level. With the right strategy, traders can make the most out of this situation.
3. Liquidity and Leverage
Oil is considered a very liquid asset to trade, which means it's really easy to convert into cash. The oil market is a very active one and trades happen in large volume almost every day. Not to mention, oil CFD is a leveraged financial product. That means traders can amplify their trading power with minimum capital.
4. Easy to Trade
While taking the first steps in oil trading can be a little bit complicated, it is still one of the easiest assets to trade compared to any other financial product due to its high liquidity. The key is to understand the fundamental matters that drive oil prices. Once traders get the hang of it, it will be easier to understand the price movements. Obviously, having a great broker and adequate knowledge help make it easier.
The Bottom Line
Trading crude oil is more affordable with a broker that offers a low-spread oil trading service. While oil trading is easy, it requires good knowledge of the commodity's fundamentals. First of all, traders should learn what moves crude oils in order to create the best strategy. Another thing is that they have to be able to learn long-term charts. This can help traders understand the historic price of crude oils to perceive the trend pattern of oil's price movement.
3 Comments
Jun 27 2022
Reading this article increased my understanding of the crude oil trading market. Considering that oil is now one of the most important commodities in the current cycle of human life, an investment in crude oil will almost certainly result in a financial gain for the investor.
This article also discusses a few online trader programs that can be utilized by readers in order to engage in crude oil trading. Excellent assistance.
Jun 27 2022
It's possible to make money by investing in crude oil, but the question is whether or not the potential gain in oil trading is worth the hassle?
Jun 27 2022
It was absolutely worth it because, as of right now, there is still a huge demand for crude oil. In fact, there are still a lot of countries that haven't gotten their hands on this product. According to the earlier article, crude oil is one of the essential requirements for human survival.
It is self-evident that one will come out ahead financially if one invests in crude oil.