Upstream M&A’s Promising Start Blunted by Ukraine War, Wild Prices

The first quarter saw announced transaction values of about $14 billion marking the strongest start in the E&P sector in five years, Enverus said

Upstream M&A’s Promising Start Blunted by Ukraine War, Wild Prices

Private company exits continued to be a “primary theme” to start 2022 and made up four of the five largest upstream deals for the first quarter. (Source: Hart Energy)

A promising first quarter of M&A retrenched in March as Russian forces invaded Ukraine and sent commodity prices into bewildering syncopation not unlike the score of a horror movie.

The first quarter saw announced transaction values of about $14 billion, including a January that opened with $6 billion in deals, and was the strongest start in the E&P sector in five years, according to an April 13 report by Enverus.

“All the factors that kept upstream deals resilient in 2021 carried over into the new year,” said Andrew Dittmar, director at Enverus. “That included a need for inventory by public companies, ready private sellers and favorable pricing. However, the volatility in energy prices caused by Russia’s invasion of Ukraine stalled nearly all deals in March.”

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Darren Barbee

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