Tired of changing N times a day, energy hedge funds build trading strategies that ignore Trump's approach

Ask AI · How does the Middle East conflict drive energy funds toward long-term investments?

The Middle East conflict has triggered severe market fluctuations, with some hedge funds fed up with Trump’s noisy comments, preparing to focus on structural opportunities in energy stocks.

Renaud Saleur, CEO of the boutique energy hedge fund Anaconda based in Geneva, stated that the fund has decided to ignore Trump’s series of statements about the conflict to avoid being disturbed by excessively dense signals, turning instead to more certain structural investments.

Since the outbreak of the Middle East conflict, the fund has been continuously increasing its positions in the oil service sector, with a cumulative return of about 35% this year. Saleur bluntly said:

The impact of Trump’s comments on the stock and derivatives markets is fundamentally unmanageable; he can change his position ten times a day.

Since the conflict between the U.S., Israel, and Iran began on February 28, Trump’s comments on targets and duration have frequently shifted, causing significant market volatility.

Day trading nearly impossible, funds shift to long-term investments in oil services

Renaud Saleur stated that since the outbreak of the Iran conflict, the fund has been continuously increasing its positions in oil service companies, currently managing assets of about $150 million.

Within this framework, the hedge fund Anaconda has been continuously buying shares of the U.S. drilling technology company Baker Hughes and the Norwegian company Frontline throughout March.

At the same time, the fund has maintained its positions in SLB and other tanker, drilling, and engineering stocks. Saleur indicated that the fund has been bullish on energy stocks and futures since December of last year. Saleur said:

There is a lot of chaos in the market, and the situation may take months or even years to calm down.

Todd Warren, a member of the Tribeca Global Natural Resources investment team and a portfolio manager, also finds the current market environment tricky. Warren said:

When the market fluctuates at this speed with tweets and news headlines, day trading is nearly impossible.

However, he believes one point is relatively clear:

Given the rising conflict risk premium, crude oil prices are likely to be significantly higher than pre-war levels, but when and how they will stabilize, no one can provide an answer.

In terms of specific investments, Tribeca is building its position in the Australian energy company Woodside to be the largest holding in its strategy by the second half of 2025; although it reduced its holdings last week, Warren still believes the stock is “severely undervalued” by the market.

Additionally, Tribeca is also “selectively” buying shares of the U.S. oil and gas exploration company Expand Energy.

Warren describes it as a company with “the largest natural gas production base onshore in the U.S.” and emphasizes that the strategic value of natural gas as a transitional fuel for energy transformation is still supported by substantial demand.

Bypassing Hormuz, betting on undervalued targets outside the South American supply chain

Armina Rosenberg, co-founder of the Sydney hedge fund Minotaur Capital, focuses on energy companies in South America based on geopolitical logic.

Armina Rosenberg believes that these companies can deliver oil and gas to buyers without passing through the Strait of Hormuz or the Red Sea, thus naturally avoiding the impact of conflict on shipping routes.

After the outbreak of the conflict, Minotaur bought shares of Parex Resources, Geopark, and Gran Tierra Energy. Rosenberg stated:

Colombian oil producers are currently among the lowest valued stocks in the entire stock market.

She also clearly defined her exit strategy:

I will not sell unless oil prices fall significantly below $75 per barrel.