Investing.com – The Moscow Exchange has emerged victorious in a dispute with traders affected by the suspension of trading in oil futures this spring, when prices hit negative values. The Moscow Arbitration Court dismissed the investors' claims.
On April 20, quotes for May WTI futures fell on the New York Mercantile Exchange to minus $ 40.32 per barrel, and the expiration price was minus $ 37.64. Meanwhile, trading on the Moscow Exchange in Light Sweet Crude Oil futures (corresponding to the WTI delivery contract on the NYMEX) ended at $ 8.84 and the next day was not held, and the expiration price was taken according to the usual rules with NYMEX, that is, minus $ 37 , 64.
Five plaintiffs, joined by 11 co-plaintiffs, demanded to declare illegal the actions of the exchange to organize trading in contracts for Light Sweet Crude Oil. In particular, they believed that the Moscow Exchange did not fulfill its obligations to organize trading properly, since it did not change the size of the collateral for these futures and the lower price limit and refused to resume trading on these contracts on the same day, allowing futures to expire at a price of minus $ 37. 63 a barrel.
Affected traders asked the court to recover losses from the trading floor in the range from 29 thousand rubles to 11 million rubles.
However, the court did not find grounds to satisfy the claim, sided with the exchange, which stated that it had made the decision to suspend trading in order to “prevent additional negative consequences for trading participants and their clients in connection with the unprecedented drop in prices in the trading of the corresponding contract on NYMEX 20 April”.
Another reason for the suspension of trading was that brokerage and clearing systems do not know how to work with negative prices and their appearance could lead to problems throughout the market, PRIME notes.
The position of the trading floor was previously supported by the Central Bank, not finding in its actions violations of the requirements of the legislation on organized trading, regulations of the Bank of Russia, as well as its own internal documents of the trading floor.
“The decision can be challenged within a month in the Ninth Arbitration Court of Appeal,” – quoted by “Interfax” the judge's decision.
In the Moscow Arbitration Court there are still two lawsuits against the stock exchange related to the April drop in oil prices: a class action lawsuit for 51 million rubles and a private lawsuit from one investor.
The text was prepared by Alexandra Shnitnikova