Enverus, an oil and gas SaaS and data analytics company, has released its 1Q summary of M&A activity, which revealed a substantial collapse as oil prices plunged to 18-year lows. Only US$770 million in US upstream deals were completed during the 1Q20 – less than one-tenth of the approximately US$8 billion average for 1Q from 2010 - 2019. Virtually all deal activity occurred before the global COVID-19 pandemic and production hike from Saudi Arabia slammed markets in early March.
“Even before oil prices collapsed on COVID-related demand issues and the surge in global production led by Saudi Arabia, M&A markets were highly challenged,” commented Enverus Senior M&A Analyst Andrew Dittmar. “Responding to Wall Street pressures, E&Ps had slashed spending and refocused from growth to cash flow dampening the appetite for acquisitions.”
