What Does an Energy Trader Do?

Increasing numbers of people are going into energy trading. It’s a fast-paced market in flux, and people who can master it stand to earn big.

What Is an Energy Trader?

Also called an energy broker, energy traders can work at energy trading software companies and facilitate deals between buyers and sellers of natural gas, oil, liquid gas, petroleum products, and energy grid shares. The day-to-day work of an energy trader involves tracking prices, predicting trends, analyzing market conditions, and procuring buyers and sellers.

As with all trading markets, the ultimate goal is to buy low and sell high. Futures contracts, wherein people promise to purchase certain assets at a later date for a fixed price, are also part of the energy trading landscape.

Generally, energy traders work for private firms, financial funds, oil refineries, energy companies, and worldwide trading floors.

How To Become an Energy Trader

People who become energy traders typically go through the same four stages.

1. Get a Bachelor’s Degree: Although rare exceptions exist, you need at least a bachelor’s degree to become an energy trader. People on the track usually major in business, economics, finance, or petroleum engineering.
2. Consider Getting a Master’s Degree: The oil and gas industry is competitive, so getting a Masters of Business Administration will give you an edge. Some programs offer special concentrations in commodities and capital markets, which can give you a leg up. Getting an MBA is important for people who concentrate on engineering during their undergraduate years.
3. Get Experience: Once you’ve secured your degrees, it’s time to get your hands dirty. Common entry-level jobs for people who want to pursue energy trading include “midstream” jobs, where you handle petroleum resources after purchase and during processing, fracking site engineer, oil rig engineer, refinery engineer, finance scheduler, or junior trader. In recent years, many people are starting out at energy trading software companies.
4. Get Licensed: Once you’re sure you want to become an energy trader, it’s time to earn a National Futures Association license. Most people fulfill this requirement by taking a Series 3 exam, the National Commodities Futures Examination.

Becoming an energy trader isn’t easy, but the rewards can be significant for those who make it.

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