The big winners of 2026 oil prices — and why they’re shifting focus
The rise in oil prices and ongoing volatility has delivered big gains in a corner of the market that rarely makes headlines: quantitative trend-chasing hedge funds.
Quantitative trend trackers, also known as commodity trading advisors (CTAs) or managed futures funds, use complex machine learning algorithms, statistical analysis, and factor-based modeling to identify price trends in futures markets, including stocks, bonds, commodities, and currencies.
The rise in commodity prices caused by the war in the Middle East has given them one of the richest trading environments in recent years.
By trading in both rising and falling markets, CTAs can provide investment portfolios with often uncorrelated returns and so-called “crisis alpha” during market turbulence, with investment decisions made by computer-based systems based on data and signals rather than human judgment or emotion.
Societe Generale’s main SG CTA Index (the industry’s key benchmark and key barometer for the overall performance of trend-following strategies) is up more than 12.2% year-to-date through June 3. The SG Trend Index, a daily performance tracker of the 10 largest trend-following hedge funds, rose 12.3% over the same period.
Energy commodities have been a major contributor to CTAs gains since the Middle East conflict began on February 28.
Brent crude oil.
But the divided narrative around the conflict and the increasingly uncertain direction of US-Iran peace talks are now forcing such strategies to scale back their bets on oil.
Helen Doody, president of Abbey Capital USA, said many funds established long energy positions early in the first quarter as the price of crude oil rose.
“They were in a position to capture the sharp rise that occurred in late February and early March due to events in Iran,” Doody told CNBC via email. he said. “CTA strategies have also typically participated in upward movements in distillate contracts such as gasoline and diesel.”
Nicolas Gaussel, CEO and CIO of Paris-based CTA Metori Capital Management, which trades both commodities and financial contracts, said roughly a third of his firm’s performance this year has come from energy trading.
Another banner year for CTAs?
The gains have drawn comparisons to 2022, when oil and other commodity prices soar following Russia’s full-scale invasion of Ukraine.
Trend-following hedge funds had their best annual performance ever that year; While the SG CTA Index rose more than 20%, managers also successfully caught the sustained decline in stocks and bonds.
Could the industry now be ready for another bright year?
Razvan Remsing, chief product strategist at Aspect Capital, said the impact of the current energy shortage is “much deeper and more widespread” than previous shocks in a much more homogeneous, globalized world.
Simplify Managed Futures ETF.
“Currently, the potential disruption to world energy supply is greater,” Remsing said. “Volatility is further subdued given AI optimism is driving risky assets higher, despite the seemingly inevitable shortage of molecules to tackle going forward.”
“In terms of magnitude, the contribution to date from the long energy positioning is comparable to the contribution seen in March 2022,” said Yung-Shin Kung, chairman and CIO of Mast Investments.
“It’s worth noting that CTAs have generally lost money on energy exposure through February 2026, so the year-to-date reference reflects a gain since March, which is roughly 250% of the loss in March and is similar in size to CTAs’ gains from energy exposure in the first quarter of 2022,” he told CNBC via email.
beyond oil
Tom Wrobel, director of capital advisory, principal services and clearing at Societe Generale, said oil gains are just one part of a much broader macro bonanza strengthening returns from CTAs in 2026.
“There are a lot of things happening; it’s not just one trend in one market,” Wrobel said in an interview with CNBC.
Yung-Shin Kung said CTAs captured the rally in precious metals, especially silver and gold, at the beginning of the year, before shifting to industrial metals that stand to benefit from AI infrastructure investment and supply constraints caused by the Iran war.
Meanwhile, Remsing said commodity-sensitive currencies such as the Norwegian krone, Australian dollar and Brazilian real are also following a strong trend as the de-dollarization theme disappears and the euro weakens due to the war.
“Energy markets, and oil in particular, made gains following the Gulf war, but our gains were by no means concentrated in this sector,” Remsing told CNBC via email. he said.
Gold futures.
Now, with oil price momentum showing signs of slowing at a time when peace talks are stalled, quantitative models may now be shedding their bets.
Doody said long positioning in energy markets has decreased in response to increased volatility and more choppy price movements, with CTAs still typically long energy but with less exposure than at the beginning of the year.
But fixed income remains more challenging as yields rise due to inflation concerns.
“CTAs on the balance sheet are currently short fixed income. Positions are broad-based across markets. CTAs are typically short European, Australian and Japanese futures contracts, although some of the largest short positions are in U.S. Treasury futures contracts,” Doody added.
Managers will monitor positions closely, Wrobel said. “They won’t want to take a huge loss as markets bounce back – I think a lot of CTAs will be reducing their position sizes.”
He added that this is ultimately business as usual for CTAs. “Catch trends as they emerge and manage risk as they disappear,” he said. As volatility increases, managers no longer need to take large positions to meet return targets, Wrobel said.
In a note published Tuesday, Citi analysts identified a “relatively rich volatility premium” for gold, copper and soybean oil, noting the difference between three-month implied volatility and one-month realized volatility. In contrast, the volatility premium remains negative across the oil complex, they noted.
Gaussel said the truly negative scenario for CTAs would be for the majority of markets to move into mean-reversion mode, as happened after U.S. President Donald Trump’s “Independence Day” tariff announcements last year.
“An isolated sharp pullback in energies could create losses in that sector, but it could also create gains in other sectors, such as stocks or other commodities, so it may not necessarily translate into losses.”
