May 18, 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.
- Permian gas glut means producers are paying buyers to haul it away
- Summary: Permian Basin natural gas prices hit an all-time low of -$9.60/mmBtu on April 24 as pipeline capacity failed to keep pace with production. While U.S. futures slipped 10% since the Iran conflict began, European and Asian prices jumped roughly 40% and over 50% respectively, shielding the U.S. economy from global energy shocks. Storage inventories sit 7.7% above the five-year average, though five new pipelines will add 11 bcf/d of capacity by late 2028 as 2026 dry gas output targets 110.61 bcf/d.
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Phillips 66 announces Zeus Gas Plant and a third Coastal Bend Fractionator - Summary: Phillips 66 is moving forward with its 300 MMcf/d Zeus Gas Plant in the Permian and a third 100 MBD Coastal Bend Fractionator in Robstown, Texas, with both projects slated to be online in 2028. The Zeus facility will include the new 45-mile Midland Express Pipeline, which is designed to integrate gathering systems and move up to 230 MMcf/d of wellhead gas. Funded within a $2.0 billion to $2.5 billion capital budget, the projects align with plans to reduce debt to $17 billion by year-end 2027.
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- High crude prices expected to accelerate M&A deals
- Summary: First-quarter M&A activity reached $38 billion, hitting a two-year quarterly high before slowing in March due to price volatility. The quarter’s value was driven by corporate consolidation, including a $25 billion Devon and Coterra merger, bringing the six-month total over $60 billion. Transaction counts dropped to a post-2020 low with only eight deals over $100 million, but current high crude prices are expected to supercharge a rebound in private sales and asset values.
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- U.S. oil rig count jumps amid rising crude prices
- Summary: The total U.S. rig count rose to 551 as active oil rigs increased by five to 415, while gas rigs fell by one to 128, according to Baker Hughes. Weekly crude oil production grew to an average of 13.710 million bpd, while completion crews rose by five to 179 and Permian rigs increased by four to 246. Oil prices climbed with the Strait of Hormuz closed, as Brent traded up 3.57% at $109.50 and WTI rose 4.23% to $105.50, marking respective week-over-week gains of $9 and $10 per barrel.
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Texas oil regulator praises record port activity, rising output - Summary: The Port of Corpus Christi handled 54.5 million tons of cargo in Q1 2026, marking its strongest first quarter ever and surpassing Q1 2025 by 6.1%. Concurrently, Diamondback Energy is immediately increasing oil output above 520,000 bpd—3% over its initial guidance—by running five completion crews and adding two to three drilling rigs. For February 2026, Texas reported preliminary volumes of 117,594,204 barrels of crude oil and 965 billion cubic feet of natural gas across the state.
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U.S. industrial natural gas consumption expected to hit records in 2026 and 2027 - Summary: U.S. industrial natural gas demand is forecast to reach record highs, rising by 1.2% (0.3 Bcf/d) in 2026 and 1.7% (0.4 Bcf/d) in 2027 from a record baseline of 23.6 Bcf/d in 2025. This gradual growth is driven by a projected rise in the manufacturing index of 1.5% in 2026 and 0.7% in 2027, which outpaces ongoing facility efficiency gains. Demand follows a seasonal pattern, peaking at 26.1 Bcf/d in January 2026 and a forecast 26.7 Bcf/d in January 2027, while dropping to 22.6 Bcf/d in June.
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Natural Gas News: June futures break 50-day MA as summer heat builds - Summary: June NYMEX natural gas futures traded near $3.00 on Friday after breaking above the 50-day moving average at $2.943 and the swing top at $2.945, targeting $3.107. The rally was fueled by an EIA storage report showing an 85 Bcf injection, below the 91 Bcf estimate, though inventories remain 6.5% above the five-year average. U.S. dry gas production holds at 109.7 Bcf/d, up 3.2% year-over-year, which serves as a price ceiling, while LNG export terminal feedgas flows reached 17.5 Bcf/d last week.
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