Commodities trader bets on Russian oil prices this year

Pierre Andurand, a commodities trader, has seen one of his fund soar 109% through the first three months of the year, after sensational gains in 2020 and 2021 as well.

He is not a permabull, either, having bet that oil prices could go negative, a prediction that came to fruition in 2020. He is incredibly bullish, saying prices could reach $200.

Russian oil won't be available to global markets for some time, even if the country can reach a peace deal with Ukraine, he says. It is not only about the ceasefire but I still think that the sanctions will stay on Russia until the West can feel like they can trust them and that they will not go attack another neighbor like a few months later or attack NATO countries, he told the Odd Lots podcast from Bloomberg. You can't go from being scared of them to using nuclear strikes and using chemical weapons and biological weapons to negotiate and give them money again. He says that the U.K. and the U.S. boycott Russian oil, reputational risk, as well as lack of insurance and credit are keeping other buyers away.

He says that Gulf countries can replace 1.5 million barrels a day from Russian production. Western countries can tap their strategic reserves to fill the rest, but will run out after about 2.5 years. Demand could fall to balance the market, according to Andurand, at $200 per barrel. Directly asked if oil could reach that level this year, he replied that it could.

The fact that maybe to have the same impact on the economy at the high price of 2008, when it was $150, might be closer to $250 today. That's the way I think of it, he said.

The intermediate grade of oil CL is from West Texas. On Friday, the lead Brent contract BRN 00 was trading near $108.