An expected increase in mergers and acquisitions in the oil and gas industry with declining interest during 2024

An expected increase in mergers and acquisitions in the oil and gas industry with declining interest during 2024


Oil sector analysts expect mergers and acquisitions in the oil and gas industry to increase further in 2024 as interest rates decline.
Rudolf Huber, a researcher in energy affairs, told Al-Eqtisadiah, “Mergers and acquisitions recorded a series of huge deals between oil and gas producers during the past year,” and more deals are likely during the current year.
He highlighted that the oil and gas industry has witnessed a wave of mergers in recent months, including ExxonMobil’s purchase of Pioneer Natural Resources for $60 billion, and Chevron’s acquisition of Hess for $53 billion.
Huber pointed out that increasing oil investments is a pivotal issue for OPEC and all organizations concerned with energy, to achieve security of supply of various energy resources.
For his part, Robert Stehrer, Director of the Vienna International Institute for Economic Studies, attributed the current weakness in demand for oil to refinery maintenance, but stressed that market prospects are positive for the rest of the year.
In his interview with Al-Eqtisadiah, Stehrer pointed out that the global oil surplus that the market is currently witnessing is due to seasonal weakness in January, as this surplus is expected to be temporary and turn into a deficit of 1.6 million barrels per day this February.
According to data from the Energy Information Administration in the United States, crude oil production reached its highest level ever in December at more than 13.3 million barrels per day, but it fell to 12.6 million barrels per day in January “due to closures related to cold weather.”
OPEC’s willingness to raise or reduce oil production at any time, regardless of market requirements, provides security and stability to oil markets.
Here, Arvi Nahar, a specialist in oil and gas affairs, says, “The messages of Prince Abdulaziz bin Salman, the Saudi Minister of Energy, to the market were positive and reassuring,” explaining that Saudi Arabia’s decision to abandon its plans to expand its production capacity of crude oil is a result of the energy transition.
She pointed to the giant Saudi Aramco’s announcement that it will update its capital spending plans for the year next March, when it announces its financial results for 2023.

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