Oil and gas continue to be among the most heavily traded commodities internationally, even in the rapidly evolving energy sector. The market is highly volatile, and full of opportunities due to geopolitical happenings and supply chain changes. If you’re someone interested in data analyses and strategic decision-making, trades, or world economics, and enjoy making tough decisions rapidly, a career in oil and gas trading might be ideal for you.
But how does one break into this industry? What are the requirements? And is it as lucrative, flexible, and exciting as it claims to be?
Let’s explore all of this.
How to Get Into Oil and Gas Trading?
An oil and gas trader deals with the purchase and sale of energy commodities for a company or an investment firm; these commodities include crude oil, natural gas, and refined products. These traders deal in “physical” products (such as barrels of oil and shipments of gas) as well as “paper” ones (such as futures, options, and contracts for difference) and make profits out of price fluctuations in the global energy markets.
Is Oil Trading a Good Career?
Their work involves tracking market movements—sustaining risks related to supply and demand, renegotiating deals around borders, and almost always buying or selling. Oil and gas traders play a crucial role in the operations of the global energy economy—working with fast-paced (and often cutthroat) businesses poised to take high risks for high rewards.
How Do You Get Into Oil And Gas Trading?
Unlike other professions, oil and gas trading is not a career you can simply “fall into” without some preparation. A perfect blend of skills, education, and connections makes it more accessible. This is a simple roadmap to get you started:
Build a Strong Educational Foundation
Completing a degree in something quantitative—finance, economics, engineering, or even physics—is step one in building a concrete base for traders. If you are a uni student, classes such as energy markets, data analytics, and derivatives will have you ready. Some professionals also have postgraduate studies in energy economics, commodity finance, or even an MBA with a specialization in trading.
Know the Market
The oil and gas trading market is “more than just buy at low and sell at a high”. It intersects with world politics, environmental concerns, infrastructure, technological influences, and even weather. Following the latest in global news and constantly monitoring trading patterns is crucial when working in oil and gas trading.
Understand the Tools Used in the Industry
There are some key phrases and terminology to first understand, like futures contracts, spot pricing, WTI and hedging. Be sure to understand common tools used in the industry like Bloomberg Terminal and ensure your Excel modelling is up to scratch.
Build Your Resume
Internships with energy companies, investment banks, and even known commodity traders such as Vitol, Glencore and Shell are incredibly valuable. And even if your entry point is in market analysis, operations, or logistics, securing the initial opportunity is important.
Start Small
Keep an eye out for junior roles to get you started and gain that first initial experience. Often these roles include focus on a range of crude oils, LNG and refindes products. From there, you can progress to physical or paper trading—depending on your interests and company structure.
How Much Do Oil Traders Make a Year?
According to Glassdoor, the estimated total pay for an Oil Trader in London is approximately £147,990 per year, with an average base salary of £103,955 per year. For specific roles, such as a Crude Oil Trader, the estimated total pay is around £93,060 per year, with an average base salary of £65,740 per year. These figures indicate that oil trading can be a lucrative career path in the UK, especially for those working in major financial hubs like London.
Oil trading tends to be a highly profitable career for certain types of people: those who can work in a high-stakes environment, love to travel and work internationally, and are skilled in market analysis. Although often compensated well, it’s important to note that this is also a very demanding business with long hours, fierce competition, and narrow profit margins. If you are someone who tracks global markets and enjoys working under pressure, intense competition, and complex problems, then oil trading may be the right career for you.