The sudden pullback in commodity prices such as oil has hit the world’s largest commodity hedge fund, Clive Capital, with losses of more than $400 million, the Financial Times reported.

A number of other similar funds, such as Astenbeck Capital, the Phibro-owned fund run by Andrew Hall, are also believe to have suffered double-digit percentage point losses to their portfolios, the newspaper said, citing unnamed investors.

The sharp fall in commodity prices has caught investors unawares. For months, the bull market in commodities appeared to be intact, driven by continued strength in emerging markets, fears about geopolitical unrest in the Middle East and North Africa, and a desire for safe-haven real assets such as gold.

Last weekend, safe-haven assets retreated in thin holiday-affected trade after the reported killing of Al-Quaeda leader Osama bin Laden, seen as a major blow to that organisation and a fillip to the US presidency of Barack Obama.

The FT said it had a copy of a letter sent to investors in which Clive Capital said it was down 8.9 per cent on the week after what it called “extraordinary” price movements last Thursday. Clive’s management said it was at a loss to explain what had caused crude oil markets to be “annihilated”.

“The move in Brent represented about a five standard deviation move, while WTI was a 4 standard deviation move,” Clive said in its letter. A five standard deviation daily move is a exceptionally rare event.

At its low of $105.15 a barrel on Friday, benchmark Brent crude oil had dropped more than $16 in two days, catching investors off-guard.