Clive Capital, the world's largest commodity hedge fund, has been left nursing losses of more than $400m as a result of the dramaticcollapse in the price of oil last week.

London-based Clive - which manages an estimated $5bn of client money - is the biggest of several big hedge funds believed to be reeling after the unexpected sell-off hit markets late last week.

Others, including Astenbeck Capital, the Phibro-owned fund run by Andrew Hall, are thought to have taken double-digit percentage point losses to their portfolios, according to investors.

The scale of the losses demonstrates that even the savviest investors in commodities were wrongfooted by the correction, one of the sharpest one-day falls on record.

In a letter sent to investors on Friday and seen by the Financial Times, Clive said it was down 8.9 per cent on the week after what it called "extraordinary" price movements on Thursday. Clive's management said it was at a loss to explain what had caused crude oil markets to be "annihilated".

"Economic data was soft early in the week though micro news for oil continued to be bullish. Indeed there was news out earlier in the week of further supply disruptions in Yemen and a substantialtechnical supply outage in the UAE," the fund said.

While several fund managers had been slowly positioning themselves for a correction, the speed and scale of the event caught most - including Clive - off-guard. At its low of $105.15 a barrel on Friday, benchmark Brent crude oil had dropped more than $16 in two days.

The correction means Clive is now slightly down on the year, after strong performance over the first four months to April.

Most managers remain bullish, however, and expect commodity prices to continue to rise.