Oil & Gas In 2026 - Emerging Trends And Predictions

Introduction

The past year has been a transformative one for global energy policy, with the new administration in the White House taking a markedly different approach to its predecessors. The second Trump presidency kicked off having promised to "drill, baby, drill" and immediately moved to end the Biden era renewable energy actions and instead prioritize domestic energy production, security and dominance.

The new policy direction was welcomed by the oil & gas industry, given the more favorable regulatory backdrop designed to speed up approvals, roll back climate and environmental regulations, remove deal blockers and put America's natural resources at the heart of foreign policy.

Nevertheless, the past 12 months have been characterized by upheaval and uncertainty as President Trump shaped and rolled out his energy agenda. With war in Europe and the Middle East, oil prices down and trade policies evolving, deal activity was particularly quiet in the first six months of 2025. There were signs of an M&A recovery in the latter part of the year, but the mega deals that have dominated oil & gas markets recently were notably absent and the appetite for moving assets around looks set to remain somewhat muted through 2026.

This year, the theme of upheaval and uncertainty continued following the U.S. capture of former Venezuelan President Nicolas Maduro and the seizure of between 30 and 50 million barrels of crude oil. The timing for bringing the Venezuelan production levels back to where the Trump Administration anticipates is unknown and depends on variables in both countries as well as the declining price of oil in global markets. The most immediate impact will relate to the lifting of sanctions, which will open opportunities for investment into Venezuela's energy industry for those willing to face the risks of operating in uncertain political conditions.

One bright spot of activity was North American natural gas, where rapidly growing demand driven by data centers and LNG exports led to a flurry of transactions. Sovereign wealth funds and other international investors were among the buyers of upstream and midstream natural gas assets in shale basins near the U.S. coast. In Europe, downstream asset sales were a theme as large oil & gas players refocused around their core strategies, while Middle East sovereigns continued to prioritize globalization.

Private equity deals, like public M&A, were fewer in number in 2025, with capital available for only the most experienced management teams. Fundraising for well-established oil & gas-focused funds was strong, however, leaving several major players sitting on large pools of capital and hungry for deals in the year ahead.

With the majority of oil & gas companies sitting on strong balance sheets and able to self-finance projects, capital markets activity was also limited over the past 12 months despite the public markets being generally more receptive to the industry. A few IPOs got done but there were few follow-on offerings, and the traditional lending and debt capital markets were primarily occupied with refinancings.

We increasingly see the oil & gas industry turning to private credit and hybrid capital solutions in the absence of traditional bank lenders, and we expect that demand to continue to grow. The escalating appetite for capital to finance both energy transition and digital infrastructure projects is only strengthening the shift to alternative financing solutions.

Looking forward, then, there remains much for the sector to navigate as we move through 2026. Oil price movements will be a key factor shaping deal activity in the year ahead, but with the political and regulatory backdrop favorable and investors easing back into hydrocarbons, we expect a busier landscape.

As we moved closer to the midterm elections, affordability of energy, and particularly consumer electricity bills, will play an increasing role in policy direction.

Opportunities abound for oil & gas companies exploring new revenue streams in emerging technologies, data center power and critical mineral supplies, and with global energy demand only continuing to scale, there will be much to do in 2026.

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