Oilfield Service M&A Expected to Surge During Trump Administration
Europe has been using up its natural gas reserves at the fastest rate in six years, just in time for winter. This situation is causing concerns about potential shortages. On another note, Argentina’s Vaca Muerta shale play is anticipated to produce up to 1 million barrels per day by the year 2030, indicating significant growth in the country’s energy sector.
Looking ahead to 2025, we can expect to see an increase in mergers and acquisitions in the U.S. oilfield services sector. Deloitte’s oil and gas industry outlook for 2025 suggests that the Trump presidency is likely to drive further consolidation in this area.
The consolidation trend is not new and has been ongoing for a while, with several major deals already completed this year. Trump’s promises to ease regulations for the oil and gas industry are expected to accelerate this trend. In the first nine months of this year alone, the value of oilfield service deals reached an impressive $19.7 billion, the highest since 2018.
John England, Deloitte’s global sector head for oil, gas, and chemicals, believes that the new administration’s approach could create a more favorable environment for mergers and acquisitions. This is particularly important for smaller independent oilfield service companies, as consolidation is becoming essential for survival in the industry.
Some oilfield service providers are consolidating to bolster their work profile and customer base, while others are forced into mergers and acquisitions just to stay afloat. The competitive landscape is changing, and companies are navigating these shifts by exploring various strategic alliances.
As we head into 2025, the oilfield services sector is poised for transformation. Keep an eye out for more mergers, acquisitions, and strategic partnerships as the industry continues to evolve under the influence of changing regulations and market dynamics.
