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LONDON, Aug 5 (Reuters) - Britain's financial watchdog and the UK Treasury met oil industry representatives on Wednesday to discuss market transparency and regulation but issued no statement after the encounter.
The UK Financial Services Authority (FSA) invited 20-30 participants including oil producers, traders and funds to the meeting in Canary Wharf, London's financial hub.
The meeting coincided with hearings in Washington by the U.S. regulator, the Commodity Futures Trading Commission (CFTC), which are likely to result in tighter rules on derivatives and possibly new limits on trading positions. [ID:nCFTCREG]
The meeting was to discuss market efficiency and transparency, according to the FSA invitation to oil market participants, a copy of which was seen by Reuters.
Oil traders leaving the meeting declined to comment on the discussions with reporters.
Funds that invest heavily in energy commodities told the CFTC on Wednesday they were not responsible for the wild swings in crude oil and natural gas futures over the last two years.
Crude oil prices leapt from around $60 a barrel at the start of 2007 to a peak close to $150 a barrel in July last year, in a move some economists say contributed to the global downturn.
Prices crashed to almost $30 a barrel at the start of 2009 as the recession cut demand for energy. Prices have since recovered to more than $70 a barrel.
Industry sources say the FSA and most UK market participants oppose tighter rules for markets, preferring instead to keep a lighter regulatory regime to encourage liquidity.
Both the Intercontinental Exchange (ICE) and the London Metal Exchange (LME), two of the world's largest commodity exchanges, have said they have no plans to change the way they regulate large positions on their UK-based markets.
But both the FSA and the oil trading community believe they need to be seen to be responding to the CFTC and its concerns, industry sources say.
Britain's opposition Conservative Party, which opinion polls suggest will win national elections due in less than a year, has promised to abolish the FSA and hand over its powers to the Bank of England to create a powerful super-regulator.
For more on commodity regulation from Reuters columnist John Kemp, please click here [KEMP/]. (Reporting by Christopher Johnson and David Sheppard; editing by James Jukwey)
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