Oil production companies like Shell and BP are set to hire more junior-level traders to replace those who have defected to investment banks.
One headhunter who works in the area, and declined to be named, says physical trading companies have suffered heavily from staff defections this year as investment banks have sought to build their commodities teams. The banks have been poaching heavily from oil traders in an effort to find talent in the overheated commodities market. The headhunter says physical trading firms rarely hire traders into lower positions, preferring instead to cultivate junior talent in-house.
Lehman Brothers and Credit Suisse are among the banks building new commodities teams. Earlier, Financial News reported that BNP Paribas plans to recruit 20 people globally for its commodities area this year.
Pay is considerably lower at trading firms than at banks, says the headhunter. However, there are upsides. "You'll earn 75 percent less working for a producer than for an investment bank," he says. "But if you work for a bank, you're liable to lose your job in a downturn. If you work at a producer, you're in there for the long term."