Valor | Energy Connection – Dec. 1, 2025

December 1, 2025 Edition

At Valor, our goal is to keep you informed of the latest news and updates from the oil and gas industry. We are committed to sharing the insights and knowledge that our team gathers to help you stay ahead in this dynamic sector. From mergers and acquisitions to regulatory changes and technological advancements, we cover all the key developments that impact the industry. Stay tuned for weekly updates to keep you well-informed.

• U.S. shale starts to crack under $50–$60 oil
• Summary: U.S. shale operators face tightening margins with oil holding between $50 and $60 per barrel, as drilling costs climb 5% to 10% and crude prices slide from early-year highs. Despite efficiency gains, oilfield employment has slipped through mid-2025, while DUC inventories in the Bakken and Eagle Ford have fallen 25% to 30%. Kpler warns U.S. output could drop by up to 700,000 barrels per day if prices stay weak, with operators noting softer returns as development shifts beyond core acreage.
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1. U.S. rig count falls off a cliff in Thanksgiving week
2. Summary: Baker Hughes reported the total U.S. rig count fell by 10 to 544 this week, driven by a steep 12-rig drop in active oil rigs to 407, while gas rigs increased by three to 130. The total count is now down 38 year-over-year, with the Permian Basin falling three rigs to 251 and the Eagle Ford losing two to 39, marking a 70-rig annual oil decline. While weekly U.S. crude production dipped to 13.814 million bpd, frac crews rose by four to 179 as WTI prices recovered slightly to trade at exactly $58.24.
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1. Natural gas surges toward $5.00 on cold snap and record exports
2. Summary: U.S. Natural Gas futures surged 3.13% to $4.850 per MMBtu, driven by early-season cold in the Midwest and East that ignited the strongest pre-winter demand since 2021. The market tightened as the EIA reported a second consecutive storage draw of 11 Bcf, leaving inventories at 3,935 Bcf, which is 160 Bcf above the 5-year average. Structural demand is underpinned by record November LNG shipments of 10.7 million tons, up 40% year-over-year, while domestic production hit a high of 109.3 Bcf/d.
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• Oil holds gains, natural gas rockets ahead of OPEC+ meeting
• Summary: Brent crude settled near $63 per barrel ahead of the November 30 OPEC+ meeting, where the alliance is expected to maintain current production quotas. U.S. natural gas prices spiked on a new LNG export record, though a rare CME blackout disrupted WTI trading amid low post-Thanksgiving volumes. Elsewhere, Syria plans to double output to 200,000 b/d, a drone strike shut Iraq’s 0.75 Bcf/d gas field, and Canada approved Anglo American’s $20 billion takeover of Teck Resources.
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• Will 2026 really mark a slowdown or a shift to disciplined growth?
• Summary: Despite slowdown fears, the EIA projects Permian crude output will reach roughly 6.9 million barrels per day by 2026, comprising over half of total U.S. oil production. While rig counts dropped by a third since 2022 and Brent forecasts sit in the mid-$50s, efficiency gains and new lithium extraction projects signal a transition to disciplined growth rather than a bust. Further validating this outlook, the Bahia NGL pipeline is expanding to 1 million bpd with ExxonMobil taking a 40% stake.
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1. Falling oil prices push gasoline below $3 in half the U.S.
2. Summary: The average U.S. gasoline price has fallen below $3.055 per gallon as 28 states dropped below the $3 mark ahead of a record 81.8 million Thanksgiving travelers. This decline is driven by a 17% year-to-date drop in oil prices, with WTI futures falling below $60 per barrel, alongside lower seasonal demand. Prices in Oklahoma dipped as low as $1.99 per gallon at some stations, marking the lowest level since 2021, with further decreases expected due to global oversupply.
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1. Texas power deals top $100 billion as electricity becomes the new oil
2. Summary: Driven by AI and hyperscale computing, Texas power M&A deals hit $106.5 billion in the first three quarters of 2025, far eclipsing the $3.7 billion total from 2021. Notable activity includes Constellation Energy’s $26.6 billion acquisition of Calpine and Fermi America’s $700 million IPO for a massive 11-gigawatt hybrid campus. Supply chain risks persist as U.S. demand for high-voltage transformers surged 116%, yet imports still make up 80% of the supply, causing lengthy inventory wait times.
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