Citadel has held talks to acquire U.S. oil production assets as the hedge fund and commodities trading giant considers expanding its ownership of physical energy resources, five people familiar with the matter told Reuters.

The firm founded by Ken Griffin was among the bidders for WildFire Energy, an Eagle Ford shale producer in South Texas that was put up for sale earlier this year by private equity firms Warburg Pincus and Kayne Anderson, four of the sources said.

Magnolia Oil & Gas ultimately won the auction, agreeing to acquire WildFire for $4.06 billion.

Citadel’s interest in WildFire was part of a broader series of discussions the firm has held in recent weeks with private equity groups that own exploration and production companies, according to the sources. The discussions have focused on acquiring oil-weighted assets, they said.

The potential acquisitions would mark a further expansion of Citadel’s physical commodities strategy at a time when geopolitical tensions are reshaping the economics of energy production and trading.

U.S. oil and gas assets have become attractive as crude prices rise and disruptions in the Middle East increase the value of supplies that can reach global markets without passing through vulnerable chokepoints such as the Strait of Hormuz.

Citadel is already one of the world’s major commodities traders, with operations spanning oil, natural gas, electricity and other markets.

Owning physical production provides a different source of exposure to those markets.

For a commodities trading firm, producing physical barrels can act as a natural hedge against financial positions. When supply disruptions or geopolitical shocks drive crude prices higher, the value of physical production can rise at the same time that certain derivatives positions may come under pressure.

Physical assets can also provide traders with greater control over supply, storage, transportation and market timing. That combination has made ownership of energy infrastructure increasingly attractive to financial firms and commodity merchants that historically focused on futures, options and other financial instruments.

Citadel’s interest also comes after a period of strong performance across the U.S. oil sector. U.S. crude reached a six-week high on Thursday as tensions in the Middle East intensified, while many oil producers reported some of their strongest quarterly earnings in years.

Industry executives have warned that even if hostilities were to end, tight supply conditions could take months to unwind. The environment increases the potential value of producing assets while making U.S. shale particularly attractive because its output is not dependent on the same maritime routes exposed to Middle East disruptions.

WildFire Would Have Offered More Than Oil Wells

The appeal of a company such as WildFire extends beyond its existing production. Acquiring an established exploration and production platform gives a buyer producing assets, an operating infrastructure, and an experienced management team capable of running the business and pursuing additional acquisitions.

That is significant because building a U.S. oil operation from scratch would require considerable technical expertise, personnel and infrastructure. A platform acquisition can instead provide an immediate base from which to consolidate additional acreage and production.

Citadel has already used a similar strategy in natural gas.

The company entered U.S. natural gas production last year by acquiring Paloma Natural Gas from EnCap Investments in February 2025 and renaming it Apex Natural Gas. Apex subsequently expanded its asset base through acquisitions, including assets from Comstock Resources and Azul Resources, which is backed by Carnelian Energy Capital.

The pursuit of oil assets suggests Citadel could be seeking to replicate that model in crude production.

Commodity Traders Push Deeper Into Physical Assets

Citadel is not alone in pursuing greater ownership of energy production. Other major commodity traders have also been moving deeper into physical oil and gas assets as they seek to capture returns across both the trading and production sides of the market.

Vitol agreed in July to sell its VTX Energy Partners U.S. shale venture, while Reuters reported last week that Gunvor was in talks to acquire more than $1 billion of assets in the Haynesville shale.

The broader trend marks a shift in the role of commodity trading firms.

Trading businesses traditionally make money by identifying price differences across locations, time periods, and financial instruments. Owning production adds another source of earnings and gives traders greater access to physical supply. It can also improve their ability to understand and manage the physical market, including production costs, transportation constraints and regional pricing.

The renewed interest in U.S. oil assets is also being driven by a changing global energy industry. The Strait of Hormuz remains one of the world’s most important energy chokepoints, carrying a large share of global oil and liquefied natural gas shipments. Prolonged disruption emanating from the U.S.-Iran conflict has already increased freight costs, insurance premiums, and crude prices.

U.S. shale production offers a degree of insulation from those risks because barrels produced in the United States do not need to pass through the strait before reaching domestic refineries and export terminals. But that does not make U.S. production immune to global shocks. American crude prices remain linked to international markets, and disruptions abroad can still affect domestic prices, drilling economics, and export demand.

However, ownership of U.S. production can give a financial firm direct exposure to rising commodity prices without relying exclusively on financial derivatives.

The potential acquisition strategy could therefore serve several objectives simultaneously for Citadel: generate returns from oil production, hedge commodity trading positions, secure physical supply and establish a platform for additional acquisitions.

That is a materially different proposition from simply taking a bullish position on crude prices. The firm would be building an integrated energy business in which trading expertise and physical ownership reinforce one another.

The WildFire bid also shows the scale at which Citadel may be willing to operate. Although it ultimately lost the auction to Magnolia, its participation indicates that established U.S. shale producers are within the range of assets the firm is prepared to consider.

If Citadel continues pursuing acquisitions, the distinction between hedge fund, commodities trader and energy producer could become increasingly blurred. The move would fit a broader industry shift in which access to physical assets is becoming strategically valuable as energy markets become more volatile, supply chains more fragmented and geopolitical disruptions more frequent.

Tesla has officially put its long-awaited Cybercab robotaxi into service, nearly two years after unveiling the vehicle, but the commercial debut has been quickly overshadowed by a federal safety investigation into the car’s unconventional driverless design.

The electric-vehicle maker said on its website that customers can now request autonomous rides through its Robotaxi app on iOS and Android. The service is available across Austin, Dallas, Houston, Miami, Orlando and Tampa, although the purpose-built Cybercab initially appears to be operating only in Austin.

Even in Austin, riders cannot specifically select a Cybercab. The vehicle is assigned based on passenger numbers and availability, meaning Tesla’s initial deployment remains tightly controlled rather than representing a full-scale launch of its dedicated robotaxi fleet.

“Hail your car and use it for errands, commuting and more,” Tesla said on its website.

The launch marks a significant step in Elon Musk’s long-running effort to turn Tesla from an automaker into an autonomous transportation company. But the following safety probes indicate that the company’s ability to scale the service will depend not only on its autonomous-driving technology but also on regulatory approval, vehicle certification, safety performance and its ability to demonstrate that a car designed without conventional driver controls can meet federal safety requirements.

The National Highway Traffic Safety Administration has opened an audit query covering about 1,000 Cybercabs following Tesla’s start of commercial service.

According to NHTSA, Tesla began operating a small number of Cybercabs commercially on Thursday after self-certifying that the vehicles comply with applicable Federal Motor Vehicle Safety Standards. Tesla has indicated that it intends to expand the number of vehicles and operate the robotaxis in additional locations.

“The vehicles lack permanently attached, conventional manual controls, such as a brake pedal, gas pedal, steering wheel and mirrors,” NHTSA said in its notice.

The agency said it is examining the process and technical information Tesla used to certify the vehicle, including whether the company determined that certain federal safety standards did not apply to the Cybercab because of its unusual design.

The investigation does not by itself establish that the Cybercab violates federal safety standards. Rather, it highlights the regulatory challenge created by Tesla’s decision to develop a vehicle specifically for autonomous operation instead of adapting a conventional passenger car with a steering wheel and pedals.

Tesla has registered hundreds of autonomous vehicles in Texas. Reuters reported that the company has registered 420 autonomous vehicles in the state, including 45 Cybercabs. It remains unclear how many of those Cybercabs are carrying paying passengers and how many are being used for testing and development.

Tesla is also operating robotaxi services in Dallas, Houston, Miami, Orlando and Tampa using Model Y vehicles, giving the company a broader operational footprint while its purpose-built Cybercab remains in a much smaller-scale deployment.

Unlike the Model Y, the Cybercab has no steering wheel or conventional brake pedal. The vehicle has been designed around the premise that there will be no human driver controlling it. Inside, it features bench-style seating for two passengers and a large central touchscreen. The vehicle also provides cargo space for luggage, scooters, and other large items.

Tesla currently owns the Cybercabs operating in Austin, but Musk has previously described a much larger business model in which customers could eventually purchase multiple Cybercabs and place them into Tesla’s autonomous ride-hailing network.

The vehicles are not yet available for individual purchase. Tesla is, however, accepting inquiries from companies interested in helping it “build its robotaxi network,” suggesting that its first sales could be directed toward fleet operators rather than individual consumers.

That model is central to Tesla’s broader autonomous-vehicle strategy. Instead of relying solely on vehicle sales, the company wants to create a transportation network in which autonomous vehicles generate recurring revenue through passenger trips. If Tesla can eventually operate such a network at scale, the economics could be materially different from those of conventional vehicle manufacturing.

For now, however, the Cybercab’s limited availability underscores the gap between that long-term vision and the current state of the business.

No Room for Kids, and When There’s a Crash

Safety requirements are particularly visible in Tesla’s rules for passengers. Children younger than 13 are not currently permitted to ride in the Cybercab, while minors between the ages of 8 and 17 can ride in Tesla’s Robotaxi Model Y vehicles. Tesla requires passengers under 18 to be accompanied by an adult.

The Cybercab also does not have the standard LATCH anchors commonly used to secure child seats. Tesla says child seats can instead be secured with the vehicle’s seat belts.

The company has also provided detailed procedures for what happens if a Cybercab is involved in a crash.

If a collision occurs, the vehicle is designed to deploy its airbags, unlock the doors, activate hazard and interior lights, disable its high-voltage battery, move its windows into a vent position, apply the brakes, and stop and park. Its infotainment system will then establish a two-way connection with Tesla’s rider-support team.

The automatic unlocking of the doors is notable given Tesla’s continuing scrutiny over electronic door latches.

Tesla has faced criticism in the United States and China over electronic door-opening systems and concerns that they could complicate escape following a crash. The company agreed last month to recall 3 million vehicles in China as part of a broader investigation involving electronic door latches that could potentially trap occupants after collisions.

The Cybercab nevertheless includes a physical interior release that is more readily accessible than those found in some other Tesla vehicles. Its doors primarily use electronic latches and can open automatically at the beginning or end of a trip, while an exterior button can also be used to open them.

Inside the vehicle, the manual emergency release is positioned on the armrest of each door, giving occupants a mechanical means of opening the doors if the electronic system becomes unavailable.

Tesla has also adopted a brake-by-wire system in the Cybercab. Rather than relying on a conventional hydraulic system that uses brake fluid and physical lines to transmit pressure, electronic actuators control the brake calipers.

“Having electric brakes avoids the complexity of a hydraulic system: no need to rout [sic] plumbing all around the car,” Musk wrote in a post.

The approach is consistent with Tesla’s broader push toward reducing mechanical components in its vehicles. The company previously introduced steer-by-wire technology in the Cybertruck, eliminating the traditional physical connection between the steering wheel and front wheels.

The Cybercab also has some less consequential but unusual design limitations. Its windows cannot currently be fully opened, according to Tesla’s documentation, although the company has not explained why.

The vehicle includes USB-C charging ports capable of delivering up to 90 watts, according to influencer Jeremy Judkins. That would provide considerably more power than the USB charging outlets typically found in passenger vehicles.

The more important question for Tesla, however, is whether its technology and vehicle architecture can move beyond a limited commercial demonstration.

The Cybercab launch represents a test of several Tesla claims at once: that its autonomous-driving technology can safely operate without a human driver, that a purpose-built vehicle without conventional controls can satisfy regulators, and that autonomous ride-hailing can ultimately become a scalable and profitable business.

The NHTSA investigation puts particular focus on the second question. Tesla has effectively asked regulators to accept a fundamentally different vehicle architecture in which components traditionally required for human driving are removed because the vehicle is intended to operate autonomously. That could eventually lower manufacturing costs and simplify the vehicle, but it also increases the regulatory burden because failures in autonomous systems cannot simply be mitigated by handing control back to a human driver.

However, a successful deployment could provide Tesla with a foundation for a global autonomous ride-hailing network and a new source of recurring revenue. But a regulatory setback, safety incident or prolonged inability to scale the fleet, by contrast, would expose the distance between Tesla’s autonomous-driving ambitions and the practical requirements of deploying driverless vehicles on public roads.

The Cybercab is finally carrying passengers, but its first real test may be whether Tesla can convince regulators and the public that a vehicle without a steering wheel or brake pedal is ready to become a mainstream form of transportation.