Upstream M&A decelerated in the second quarter of 2025, with value falling 21% quarter-over-quarter to $13.5 billion, according to Enverus Intelligence Research (EIR) summary of Q2 2025 upstream M&A activity and outlook for the rest of the year. EIR analysts say this is the second lowest quarterly deal value since the start of 2024 and placed 1H25 M&A value at $30.5 billion, a 60% drop compared to the first half of 2024.
“Volatility in commodity and equity markets raised a major yellow flag for M&A, slowing the pace of dealmaking,” commented Andrew Dittmar, principal analyst at EIR. “That added an additional barrier to a market that was already challenged by the lack of remaining attractive opportunities for public E&Ps, especially in the Perman basin. The engine of M&A over the last few years has sputtered and stalled.”
In contrast to public operators, private capital has more flexibility in the types of deals and assets pursued as well as not needing the same scale as public companies. Some are returning to the Permian Basin, picking up small assets or focusing on extensional areas not yet consolidated by large operators. However, the biggest opportunities are likely to be in areas off the radar of public companies. The SCOOP | STACK in Oklahoma is one such region where public companies are more likely to be sellers than buyers.
Asia-based companies with LNG import commitments are an emerging force for buying Gulf Coast area gas assets. The combination of accelerating international interest in gas linked to Gulf Coast LNG plus emerging datacenter demand in Appalachia has the potential to rev up gas M&A.
One type of deal that has been notably absent this year is public company consolidation, a key component of the market in 2023 and 2024. “These types of deals should be easier to negotiate in a volatile environment given they are generally stock-for-stock swaps that limit commodity price risk,” said Dittmar.
