Citadel Seeks US Shale Assets as Commodity Traders Expand Physical Ownership

Hedge fund giant Citadel is exploring opportunities to acquire U.S. shale oil production assets, according to sources. The firm has reportedly held talks with private equity firms that own exploration and production companies about buying oil-weighted assets. Citadel's interest in acquiring physical production assets aligns with the company's strategy of expanding into owning tangible assets.

Citadel was among the bidders for WildFire Energy, which was sold to Magnolia Oil & Gas for $4.06 billion earlier this year. The hedge fund has also been engaged in discussions with other private equity firms about acquiring oil and gas production assets. Industry executives have warned that tight supply could persist even if hostilities in the Middle East were to end immediately.

Citadel's move into physical production assets is part of a broader trend among major commodity traders, who are expanding their ownership of oil and gas production. Vitol agreed to sell its U.S. shale venture earlier this year, and Gunvor is reportedly in talks to acquire assets in the Haynesville shale for over $1 billion.