Oil Traders Bet on Risk as Diplomacy Yields Little

Market Overview - Oil prices have had their strongest start to a year since 2022, with ICE Brent futures up 18% since the beginning of the year [5] - Brent monthly call option volumes reached an all-time high of 5.8 million contracts last month due to rising volatility and anticipation of US military strikes on Iran [5] - The net positioning of hedge funds in ICE Brent futures has been bullish, with a reported net length of 263,186 contracts as of February 17, more than doubling since early January 2026 [6] Price Movements - WTI price is at $66.58, up by $0.24 (+0.36%) [2] - Brent price is at $71.77, up by $0.28 (+0.39%) [2] - Natural Gas (Nymex) price is at $2.953, down by $0.032 (-1.11%) [2] Rig Count and Production - Total rig count stands at 551, down from 588 a year ago, with 409 oil rigs and 133 gas rigs [3] - The Permian Basin has 239 active rigs, with a slight increase of 1 rig from the previous week [4] Company Developments - ENI is considering revamping its oil trading business, aiming for a partnership with Mercuria [7] - Shell is expected to advance its Dragon gas field offshore Venezuela, targeting first gas by Q4 2027 after receiving US approval [7] - Azule Energy, a BP-ENI joint venture, has started production at its Ndungu field in Angola, aiming for a peak output of 60,000 b/d [8] - Mubadala Energy acquired a 15% interest in Chevron's Nargis offshore concession in Egypt, taking over ENI's previous 45% stake [8] Geopolitical Context - Oil markets remain tense amid ongoing US-Iran nuclear talks, with ICE Brent hovering around $72 per barrel despite macroeconomic concerns [9] - Goldman Sachs has raised its 2026 price forecast for Brent and WTI by $8 per barrel to $64 and $60, respectively, assuming no disruptions from Iran [10]