Upstream A&D 2022 Outlook: All About Commodity Prices

From consolidation to the growing focus on ESG investing, here’s what to expect from A&D activity in the upstream oil and gas space for the year ahead.

Upstream A&D 2022 Outlook: All About Commodity Prices

As commodity prices have stabilized—or even fallen into a rut—the relativity strong price tape will allow deal activity to remain elevated through the year, according to an outlook by PwC. (Source:

Consolidation will continue to be the driving storyline in 2022 as oil and gas companies tilt toward scale and synergies through A&D, although deals will face headwinds from policy uncertainty and a focus on renewable energy.

Seenu Akunuri, leader of PwC’s U.S. energy and mining valuation practice, told Hart Energy he expects 2022 to look similar to last year.

“A lot of the deals in 2021 primarily happened because of the lessons learned in the previous downturn and COVID-19’s impact,” he said. “Companies, especially on the exploration and production side, were all focused on how they could reduce breakeven margins so that they could continue to generate free cash flow, even if commodity prices were lower than what we’re seeing currently.”

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Darren Barbee

Darren Barbee is senior editor for Oil and Gas Investor magazine.