The storm doubled natural gas prices. But gas producers were already winning before this price tailwind.
In my latest analysis at Foundations of Energy, I dig into capex patterns across 15 publicly traded E&Ps to show how the US upstream sector has split into two very different markets over the past two years.
The key findings:
• Oil and gas prices have been diverging since early 2024: WTI down from $80 to $60, Henry Hub up from under $2 to around $4
• Liquids-focused E&Ps continue to reduce capex, while gas-focused producers have started ramping investment back up over the past three quarters
• When you adjust for inflation, the gap between today’s capex and historical levels is even wider than it appears
The demand drivers on the gas side (LNG exports, data center buildout) have no equivalent on the oil side.
That asymmetry is showing up in how operators are allocating capital.
The full post walks through the data and raises a question worth considering: how will liquids-focused operators respond?
