Study: US oil and gas mergers and acquisitions quadrupled last year

The US oil and gas sector is undergoing a transformation. The 2024 wave of mergers and acquisitions, which reached a record 188 billion euros (206.6 billion USD), reduced the number of major players from fifty to forty. According to an study by EY, this is creating a smaller but stronger group of companies ready to shape the future of US energy. The first half of 2025, however, points to a slowdown in business amid lower oil prices, limited availability of attractive assets and political uncertainty.

According to a study published by consulting firm Ernst & Young (EY), the US oil and gas industry is undergoing a rapid transformation. It is being driven by a wave of mergers and acquisitions that began last year, reducing the number of publicly traded companies from 50 to just 40. The major players nevertheless still account for approximately 41% of US oil and gas production in 2024—a share unchanged from previous years.

“This is a pivotal moment for the US upstream sector,” said Pat Jelinek, head of EY Americas Oil & Gas and Chemicals. “A smaller number of stronger players is emerging, better capitalized, more efficient and strongly focused on resilient growth. The new top forty companies are not just survivors; they are ready to shape the future of US energy,” Jelinek added.

M&A activity in 2024, at 188 billion euros (206.6 billion USD), was up 331% from 2023 and was driven by five mega-deals worth more than 9.1 billion euros (10 billion USD). A total of 42% of the value of the acquired assets was in unproven reserves, pointing to a focus on future production and growth.

The study also says this was the highest proportion of acquisitions in the sector since 2020. This may indicate that companies expect US oil and gas exports to increase in the coming years. The study’s authors also cite lower commodity prices in early 2024 as a factor, offering attractive valuations for assets.

A slowdown after a dynamic year

Despite the EY study’s findings, which analyze the years 2020 to 2024, activity fell sharply in the first half of 2025. According to a commentary in the British newspaper the Financial Times, the slowdown is due to falling commodity prices and the limited availability of “premium” assets in the Permian Basin, North America’s most important shale region.

The region lies on the border between New Mexico and Texas. In 2024, deposits in the area accounted for 22% of total US natural gas production. Companies such as Exxon Mobil, Chevron and Occidental Petroleum have a strong presence in the Permian Basin; Warren Buffett, an American investor, made a significant investment in Occidental Petroleum last year.

According to a Reuters report in May, investor caution also stems from concerns about Trump’s trade policy.

“We are in a period right now where there is so much noise and volatility that not much is getting done,” said Kaes Van't Hof, chief financial officer of Diamondback Energy, one of the most active companies in the M&A market last year.

“Anything we looked at would have to be extremely cheap, and I don’t think we’re there today,” he added.