Hall's Astenbeck Capital Up 24% YTD As Prediction of Oil Price Rebound Proves Prescient

Jun 8 2016 | 11:32pm ET

Correct bets on rebounding oil prices have delivered the best three months in two years for Andy Hall's Astenbeck Capital Management.

The energy bull’s fund notched its third straight month of gains in May, posting a return of +5% and bringing year-to-date gains to 24%, according to a Reuters article citing an investor letter. The period caps the best stretch for Astenbeck since a five-month run in 2014.

Hall’s performance was decimated last year along with the price of oil. The fund lost 36%, it’s worst year since inception. 

Indeed, in the latest letter, Hall noted that the capacity adjustment was proceeding more rapidly than he expected at the start of this year, raising the “prospect of an extremely undersupplied market later this year and in 2017," he wrote, which would put a bid on prices. 

In February, Astenbeck predicted the price of oil would recover to as high as $60-$80 per barrel as output drops and inventory is worked down. Brent hit an eight-month high earlier this week as data regarding U.S. stockpiles came in lighter than expected and concerns about Nigerian output in the face of renewed terrorist attacks rose. 

Hall founded Southport, CT-based Astenbeck in 2008 after a highly successful stint as an oil trader for Citigroup during which he famously earned a $100 million bonus. The firm's total assets under management have reportedly fallen from around $3.3 billion in June 2014 to approximately $2.4 billion now. 

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