$LICK ’N’ SICK

Conn. hedge fund shorts oil, pockets $200M

There will be blood, but also glory, in the oil patch.

This year’s collapse in oil prices is providing a killing for a few bold hedge funds that defied conventional wisdom and predicted that alreadylow energy prices would continue to slide.

Take Taylor Woods Capital, a $1 billion Greenwich, Conn.based fund that was up 20 percent through midDecember, according to Reuters.

While consumers are saving hundreds of dollars this year in gasoline and oilheating costs, Beau Taylor and Trevor Woods are closing in on a $200 million payday.

The former Credit Suisse prop traders launched the macro commodities fund in 2010, but suffered big losses until bearish bets made in late 2013 started to pay off in the middle of 2014.

Oil prices fell about 50 percent last year, despite the conventional wisdom that the pain was over.

In January, the US Energy Information Administration cut its estimates by close to 20 percent — and predicted West Texas Intermediate crude oil would average $63 per barrel and that Brent this year would average $68 a barrel.

But on Tuesday, crude oil futures trading on the New York Mercantile Exchange closed at $34.66 — the lowest level since March of 2009.

That’s been painful for many famous investors, including Carl Icahn and David Einhorn, who’ve stuck with their convictions on energy’s rebound even after last year’s losses.

But few have been hurt as much this year as Astenbeck Capital’s Andy Hall — another former big bank trader and one of the betterknown and successful oil traders.

Astenbeck, based in Southport, Conn., was down 26 percent through Oct. 31, as Hall clung to his conviction that oil prices would recover, Reuters reported.

Astenbeck manages more than $2 billion, putting Hall’s losses at more than $500 million this year.

Hall launched Astenbeck in 2008 while still at Citigroup. His bullish oil bets earned him a $100 million bonus while there.

“There is certainly still a chance of lower prices in the next month or so, but weighing that possibility against the virtual inevitability of higher prices down the road leads to a simple conclusion: Now is not the time to exit the market,” he wrote investors in a recent letter.

Taylor declined to comment. Hall did not return a call.