Energy Bull Andy Hall’s Astenbeck Capital Enjoys Strong Returns

Andrew Hall of Astenbeck Capital Management, who is also referred as “Oil God” in the energy market, has been long crude despite the sell-off. Mr. Hall founded Astenbeck Capital Management in 2007 and at the same time he continued as one of the heads for Citigroup’s subsidiary Phibro LLC. He came into spotlight during 2008 crisis when Citigroup asked for permission from the Treasury Department to pay him $100 million as a bonus at a time when Citigroup was bleeding money. Citigroup succumbed to pressure and sold Phibro to Occidental Petroleum for $370 million. At that time Mr. Hall bought 80% of the stake with the help of Citigroup, while remaining 20% was held by Occidental Petroleum. The fund has an equity portfolio worth $121.59 million at the end of the second quarter. The fund is down by approximately 2% at the end of June.

So far this year, crude prices to the $26-levels in February amid oversupply concerns in Feburary before rebounding and reaching around $51 in June. In this way, the commodity prices are up by around 10% year-to-date. Astenbeck Capital cut its equity portfolio during the fourth quarter of 2015, unloading most positions and ended the first quarter with just four holdings, which it held onto throughout the first half of 2016. In this article, let’s take a closer look at how Astenbeck Capital Management holdings in Occidental Petroleum Corporation (NYSE:OXY), Pioneer Natural Resources (NYSE:PXD), EOG Resources Inc (NYSE:EOG), and CME Group Inc (NASDAQ:CME) performed this year.

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Occidental Petroleum Corporation (NYSE:OXY)

– Shares Owned by Astenbeck Capital Management (as of June 30): 980,000

– Value of Astenbeck Capital’s holding Management (as of June 30): $74.05 million

The largest position in Astenbeck Capital Management’s equity portfolio is represented by Occidental Petroleum Corporation (NYSE:OXY). The fund’s holding remained unchanged at 980,000 shares worth $74.05 million during the second quarter. The company suffered a major setback after production was halted at three of its Colombian fields because of an attack from guerrillas on its pipeline. The issue has been pending since July 4 and a repair to Cano Limon Line was expected to be finished recently. Cano Limon, Chipiron, and Caricare are the three fields, which produce 56,000 barrels per day. Rain, bad roads along with dangerous area has added to the woes. Shares of Occidental Petroleum Corporation (NYSE:OXY) have gained around 17% since the beginning of the year.

On the next page, let’s look at Pioneer Natural Resources (NYSE:PXD), EOG Resources Inc (NYSE:EOG), and CME Group Inc (NASDAQ:CME).

Pioneer Natural Resources (NYSE:PXD)

– Shares Owned by Astenbeck Capital Management (as of June 30): 150,545

– Value of Astenbeck Capital Management’s holding (as of June 30): $22.76 million

Pioneer Natural Resources (NYSE:PXD) represents Astenbeck’s second-largest position, which contains 150,545 shares worth $22.76 million as of the end of the second quarter. The stake was unchanged during the quarter. Reduced production costs is helping Pioneer Natural Resources (NYSE:PXD) to compete with Saudi Arabia in Permian Basin and the company has reduced its production costs to $2 per barrel by improving on fracking techniques. CEO Sheffield stated: “My firm belief is the Permian is going to be the only driver of long-term oil growth in this country. And it’s going to grow on up to about 5 million barrels a day from 2 million barrels,” even in a $55 per barrel price environment, he added. Among the investors we track, 74 funds were long the stock at the end of the second quarter, compared to 61 funds a quarter earlier.

EOG Resources Inc (NYSE:EOG)

– Shares Owned by Astenbeck Capital Management (as of June 30): 262,000

– Value of Astenbeck Capital’s holding Management (as of June 30): $21.86 million

On the third spot is the US-based EOG Resources Inc (NYSE:EOG), in which Astenbeck also didn’t change its position during the second quarter and reported ownership of  262,000 shares worth $21.86 million. For the second quarter, EOG Resources reported revenue of $1.78 billion, which topped estimates by $170 million, while net loss of $0.38 was better than the expected loss of $0.48 per share. EOG Resources Inc (NYSE:EOG)’s stock has gained 28.26% since the beginning of the year. A total of 36 funds from our database held shares of EOG Resources Inc (NYSE:EOG) with a total value of $638.33 million.

CME Group Inc (NASDAQ:CME)

– Shares Owned by Astenbeck Capital Management (as of June 30): 30,000

– Value of Astenbeck Capital’s holding Management (as of June 30): $2.92 million

Astenbeck Capital Management’s position in CME Group Inc (NASDAQ:CME) remained during the second quarter. The fund holds 30,000 shares of the company valued at $2.92 million. CME Group Inc (NASDAQ:CME) reported revenue of $906 million, which missed expectations by $5.91 million, while EPS of $1.14 was higher than analysts’ expectations of $1.11. CME Group Inc (NASDAQ:CME)’s stock is up by 18.36% since the beginning of the year. A total of 49 funds from our database held long positions in CME Group Inc (NASDAQ:CME) worth $1.24 billion in aggregate, at the end of the second quarter.

Disclosure: None