Exclusive: Top commodities funds take fresh beating in June

NEW YORK Thu Jul 7, 2011 6:03pm EDT

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NEW YORK (Reuters) - Two of the biggest commodity hedge funds suffered a second month of painful losses in June, falling victim to a rout across raw goods markets, a hedge fund investor told Reuters on Thursday.

Clive Capital, a top commodities fund with more than $4 billion under management, and energy-focused BlueGold, with around $2 billion, hit a rough patch in May and June due in part to a series of sharp drops in oil prices, said the investor, who is familiar with the funds' returns.

The 19-commodity Reuters-Jefferies CRB index fell nearly 9 percent over May and June, the largest two-month loss since the 2008 financial crisis.

London-based Clive, led by star trader Chris Levett, lost around 8 percent last month and brought its year-to-date drop to near 10 percent, the investor said, requesting anonymity. Clive gained around 20 percent last year.

London's BlueGold, led by French oil trader Pierre Andurand, dropped 5 percent in June and brought its year-to-date losses to near 12 percent, the investor said. BlueGold gained 12 percent last year.

Another fund with major commodities exposure, New York-based Ospraie with about $2 billion under management, lost 3.1 percent last month but was up 1.7 percent in the year through June, fund data obtained by Reuters showed.

Paul Touradji's New York-based commodities-focused Touradji fund, which managed around $2.5 billion as of January, fell around 3 percent in June, bringing year-to-date losses to near 13 percent, a separate fund industry source said. Touradji could not be reached for comment.

Clive and BlueGold also could not be reached. A spokesman for Ospraie declined to comment on the fund's performance.

The funds trade oil as well as other raw goods such as metals and agricultural products.

AVOIDING ANNUAL LOSSES

Unless they recover in the second half, BlueGold and Clive may face their first annual losses, hedge fund industry sources said.

The two funds suffered large losses on May 5, when oil plunged more than $10 a barrel in one of the steepest one-day drops ever, the sources said.

June 15 saw a further sharp drop in crude and prices plunged by near $5 a barrel on June 23, the day the International Energy Agency surprised oil market players by saying it would release 60 million barrels of oil supplies onto world markets to make up for lost exports from war-torn Libya.

"It was a volatile month in general for energy funds, though some of these guys really lost money after the IEA announcement," said the source who provided Reuters with the performance numbers for Clive and BlueGold.

By the end of June, oil prices had largely recovered. Brent dropped 2 percent in the month to end near $112 a barrel. The European benchmark crude hit a 2011 high near $124 in April, when Clive and BlueGold posted gains.

Since it began trading in 2008, BlueGold has often delivered mouth-watering returns. It gained 200 percent in 2008, when oil shot to a record $147 a barrel.

In the five months through May, the average energy-focused hedge fund was down 3.6 percent, according to the latest figures available from Chicago-based Hedge Fund Research.

Funds that bet aggressively on oil may already be recovering from June pitfalls. Brent futures surged a whopping $4.97 a barrel in late trade on Thursday, to $118.59 a barrel.

(Editing by Dale Hudson)

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