Pierre Andurand turns bearish on the long-term prospects of oil is raising eyebrows, bearing in mind the oil heavyweight traders turn ultra bullish following the epic oil price collapse of 2020. The oil price fell into unprecedented negative territory due to a demand shock triggered by a black swan event, pandemic global lockdowns.
Pierre Andurand has a string of wins under his belt, and his often contrarian calls tend to be bang on the money. For example, last year Pierre Andurand correctly predicted that oil prices would collapse into negative territory. Pierre Andurand’s winning call returned 82.5% through to the end of September.
“Pierre Andurand turns bearish on the long-term prospects of oil is raising eyebrows”
WEALTH TRAINING COMPANY
Pierre Andurand’s Andurand Commodities Discretionary Enhanced Fund bought the dip and bagged sizable winnings for his investors. Andurand Commodities Discretionary Enhanced Fund, disclosed in documents sent to investors in September follows last year’s 154% advance. Pierre Andurand’s older Commodities fund, which returned 68.6% last year, is up 33% for the same period.
But the oil trader is no longer bullish Pierre Andurand is now bearish over the long-term prospects for oil
“We are bearish on the long-term prospects of oil, and see renewable energy as the market to go long,” said Pierre Andurand in an interview with Forbes earlier this year.
So energy oil trader Pierre Andurand turns bearish on carbon fuels but bullish on clean energy.
“We are bearish on the long-term prospects of oil, and see renewable energy as the market to go long”
PIERRE ANDURAND
Pierre Andurand is so upbeat on an alternative to carbon-based energy that he is planning to launch a long/short fund. Pierre Andurand’s new fund would enable him to bet on emerging clean technologies at the expense of declining carbon producers, which he believes are substantially overvalued.
The energy traders’ bullish stance on cleaner energy alternatives is a contrarian view, bearing in mind that alternative energy has underperformed year-to-date.
“the trend away from fossil fuels is likely to accelerate with current high oil prices, particularly as the cost of solar and wind energy continues to fall” – Wealth Training Company
For example, Solar (-6% year-to-September), Hannon Armstrong (-13%), and Atlantica (-5%) are at sector weight for reasons ranging from supply chain issues to financing and rate concerns.
Only Nextera is positive on the year among this group. Meanwhile, energy composed largely of oil and gas stocks is the second best-performing sector in the market, up 25% since January.
Pierre Andurand turns bearish on carbon fuels, and he now thinks the best returns for investors will be in the clean-energy transition
Moreover, the trend away from fossil fuels is likely to accelerate with current high oil prices, particularly as the cost of solar and wind energy continues to fall.
Pierre Andurand turns bearish on carbon fuels and that also implies that OPEC will keep oil prices stuck at 2021 highs
So, when oil prices overheat OPEC tends to lower prices which then dampens demand for alternative energies.
Pierre Andurand bullish stance on clean energy also has implications for metals going forward
A clean energy transition implies increasing demand for metals such as copper, aluminum, and nickel, which are all critical metals to create electricity.
The imminent electrification of mass transportation could be the crux of why Pierre Andurand turns bearish on carbon fuels. Analysts now think the global market share of internal combustion engine cars peaked in 2017. Andurand thinks oil demand more broadly will peak around 2027.
Perhaps that could be even sooner, bearing in mind the higher speculators push oil prices, the faster the transition to non-fossil fuels is likely to be.
