What Should We Expect With Oil & Gas M&A Activity In 2023?
Q&A: The State Of Oil & Gas M&A Activity & What To Expect In 2023
The current landscape of M&A and A&D dealmaking in the U.S. oil and gas industry looks a lot different than what it did in the 2015-2019 period. During the pandemic, commodity prices sank to historically low levels (WTI crude oil futures went negative in April 2020).
Today, despite strong energy prices resulting from the post-pandemic economic recovery and a reshaping of global energy flows triggered by Russia’s invasion of Ukraine, oil and gas companies face new headwinds such as record-high inflation, rising recessionary risks, the energy transition, and concerns about oilfield cost inflation—all of which are having material impacts on how M&A and A&D deals get done.
Optimism continues to swell, however, that the increase in deal momentum experienced during the second half of 2022 will carry over into 2023. Upstream M&A and A&D deals reached a year-to-date high of more than $16 billion of transacted value during Q3 2022, according to Enverus. That was achieved despite continued volatility in oil and gas prices and oil and gas company stocks still missing market recognition.
