February 2, 2026 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.
- Big freeze disrupts U.S. oil and gas production
- Summary: Winter Storm Fern slashed U.S. oil production by up to 2 million bpd (15% of the total) and natural gas output by 11% over the weekend, with the Permian Basin bearing the brunt of the freeze. While Permian oil outages initially hit 1.5 million bpd, production is recovering and expected to be fully restored by month’s end. The supply shock triggered a historic 117% rally in natural gas prices—the strongest since the 1990s—before easing as traders took profits.
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- Devon and Coterra merge in $58 billion shale deal
- Summary: Devon Energy and Coterra Energy have agreed to a $58 billion all-stock merger, creating a massive U.S. shale operator with production exceeding 1.6 million barrels of oil equivalent per day. The combined company, which will retain the Devon name and be headquartered in Houston, aims to generate $1 billion in annual synergies while consolidating top-tier assets in the Permian, Marcellus, and Anadarko basins. This strategic move responds to lower oil prices by securing the largest inventory of sub-$40 breakeven drilling locations in the Delaware Basin.
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- U.S. drillers add 2 rigs as crude output falls
- Summary: The U.S. total rig count rose by two to 546 this week, as a gain of three gas rigs (totaling 125) offset a single-rig decline in miscellaneous drilling, while oil rigs remained flat at 411. Despite this slight weekly increase, the total count remains down 36 rigs year-over-year. U.S. crude production fell for another week, dropping 36,000 bpd to 13.696 million bpd—166,000 bpd below the all-time high. Meanwhile, the Permian Basin saw a decline of two rigs, though oil prices trended higher with Brent reaching $70.81.
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- Natural Gas surges as freeze offs cut 15 percent of supply
- Summary: Natural Gas futures (NG=F) surged over 120% in a week—with the February Henry Hub contract briefly hitting a three-year high of ~$7.43 before settling near $4.42—as Winter Storm Fern drove record demand and froze off nearly 15% of U.S. production. While the storm triggered a massive 242 Bcf storage withdrawal, inventories remain roughly 143 Bcf above the five-year average, providing a buffer that prevented prices from holding the extreme $7+ highs. Technically, the market has shifted to a bullish trend, with support established around $3.82 and immediate upside targets near $4.55–$4.80.
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- Oil prices tumble 5% amid signs of U.S.-Iran de-escalation
- Summary: Oil prices fell more than 5% on Monday, retreating from five-month highs, after comments signaled potential de-escalation in U.S.–Iran tensions. Brent crude slipped to $65.99 per barrel and WTI to $61.92 as the geopolitical risk premium eased. Analysts noted that broader market weakness and ongoing efforts to limit fuel price volatility could constrain the likelihood of further escalation.
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- Eagle Ford on the chopping block as Exxon refocuses drilling strategy
- Summary: ExxonMobil’s subsidiary, XTO Energy, is marketing its Eagle Ford shale assets in South Texas for approximately $1 billion as the company doubles down on its highest-return projects. The potential sale includes over 1,000 wells spanning 168,000 net acres, consisting of both operated and non-operated interests. This move aligns with a broader industry trend of shedding non-core assets to counter rising production costs and softening oil prices. Exxon plans to redeploy capital into its “advantaged” assets, specifically its massive Permian Basin holdings—bolstered by the 2024 Pioneer acquisition—and its highly prolific offshore projects in Guyana.
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- 7.65 GW gas power project permitted in Texas for AI
- Summary: Pacifico Energy has received approval for the GW Ranch project in Pecos County, Texas, the largest permitted power project in U.S. history. This 7.65 GW gas-fired campus includes 1.8 GW of battery storage and 750 MW of solar, specifically designed as a private-grid facility to support hyperscale AI data centers. Construction is scheduled to begin in Q1 2026, with initial power delivery by early 2027. By operating off-grid, the project avoids ERCOT interconnection queues and aims to protect local consumers from price hikes, though it has drawn attention for being authorized to release greenhouse gases equivalent to 5% of Canada’s total annual emissions.
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