JPMorgan to start physical oil trade, eyes $200 oil
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its exposure in a market that could rise to $200 a barrel, the bank's global
head of commodities said on Wednesday.
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JPMorgan to start physical oil trade, eyes $200 oil
Sambit Mohanty
Reuters
Wednesday, May 14, 2008
JPMorgan Chase & Co will begin trading physical oil by year-end, increasing
its exposure in a market that could rise to $200 a barrel, the bank's global
head of commodities said on Wednesday.
The bank plans to expand in commodities and energy trading, Blythe Masters
said, despite expectations of job cuts in other areas as it prepares to take
on staff from Bear Stearns at the same time it deals with turbulent
financial markets.
"We will start trading in physical oil and refined products by the end of
this year," she told Reuters in an interview.
JPMorgan will join a growing list of investment banks from Goldman Sachs to
Barclays Capital seeking to boost profits on their big derivatives trading
desks by gaining a foothold in physical markets.
The third-largest U.S. bank added 50 people to its commodities and energy
trading and investment team last year and is on track to hire a similar
number this year, taking the strength of the total team globally to 450,
Masters said.
Earlier this month, it hired former Goldman Sachs banker Oral Dawe as
managing director and CEO of its Asia Pacific commodities group, in addition
to hiring more than a dozen traders in Asia recently to oversee its
expansion in energy and metals.
And with oil prices surging more than 30 percent this year to a record near
$127 this week, Masters said the bank would look at more ways to boost its
presence in energy markets.
"Oil rising to $200? It could happen. This year? You could see it, although
it would take a further shock to expectations," she said.
Full article here.
http://www.reuters.com/article/ousiv/idUSSP14850120080514