Hedge fund Elliott Management has taken a €670mn short position in French energy major TotalEnergies according to regulatory filings, as the US activist firm agitates for change at rival BP.
The bet, worth 0.52 per cent of TotalEnergies’ stock, was taken on Thursday and publicly disclosed by the French markets regulator on Friday.
Elliott’s move came after it took a stake of almost 5 per cent in struggling UK oil major BP in February, worth almost £3.8bn, where it is pushing for big divestments and a renewed focus on oil and gas.
Hedge funds often take short positions in competitors of a company in which they have stakes to reduce the impact of broader market movements on their portfolio.
A person familiar with the hedge fund’s thinking said the position was part of Elliott’s global hedging programme.
Nonetheless the size of the short position makes it striking, according to market experts.
“Even in the broader hedge fund landscape, this one stands out — among the biggest shorts revealed over past several years,” said Ivan Ćosović, founder of data group Breakout Point.
The bet against TotalEnergies comes despite the business performing more strongly than its European competitors in recent years, and taking a more measured approach to the energy transition than the one adopted by BP.
Under long-serving chief executive Patrick Pouyanné, TotalEnergies is still investing in expanding its production of oil and gas. It has a growing portfolio in liquefied natural gas, which the business sees as an important “transition” fuel.
TotalEnergies, which has a market capitalisation of about €129bn, reported annual results that were ahead of market expectations last month, despite a slowdown in commodities and refining markets contributing to a 21 per cent fall in net income.
As it continues to commit to oil and gas exploration, TotalEnergies is also exploring a continuous listing of its shares in New York and Paris, in a bid to tap into a US investor base that is less sensitive to environmental concerns than their European counterparts.
The French company is also growing its renewable energies portfolio through its electricity division, Integrated Power, which combines gas-fired electricity plants, with wind, solar and battery technology.
Despite the Trump administration’s opposition to offshore wind leading to the company putting a large US wind farm project on hold, Pouyanné said last month that the company would not change its renewable energy strategy.
It is aiming to increase electricity production from 41 terawatt hours in 2024 to more than 100TWh of electricity by 2030.
Elliott declined to comment. TotalEnergies did not immediately respond to requests for comment.