President Donald Trump invoked the Defense Production Act to accelerate domestic energy projects, targeting LNG, oil, coal, and grid infrastructure to boost supply. The move aims to lower energy costs and meet rising electricity demand driven by AI and data center growth.
Louisiana drilling activity remains concentrated in the Haynesville, with 26 wells spud in the last 30 days and DeSoto Parish leading all regions, driven primarily by Expand Energy and Apex Natural Gas. Operator activity is highly consolidated among a few key players with consistent contractor alignments, indicating ongoing multi-well drilling programs and stable near-term service demand.
Oklahoma drilling activity over the past 30 days has been led by a small group of operators, with Mewbourne Oil, Continental Resources, and Validus Energy deploying the most rigs across key counties. Activity remains highly concentrated in Roger Mills, Custer, and Grady counties, highlighting a focused drilling corridor and clear targeting opportunities for service companies.
The Midland Basin supports large, high-density pad drilling due to lower costs per foot and oil-weighted economics, enabling a factory-style development model. In contrast, the SCOOP play in the Anadarko Basin has higher drilling costs and is gas-weighted, leading operators to favor smaller, phased pad development focused on precision and capital discipline.
Continental Resources is increasing drilling efficiency in Grady County, converting 13 of 21 permits into active wells with an average ~50-day cycle time while maintaining an inventory of 8 locations. The shift toward concentrated Patterson rig usage reflects a precision drilling strategy aligned with the county’s gas-weighted economics and repeatable development model.
Oil prices jumped over 6% as rising U.S.–Iran tensions increased the risk of disruption in the Strait of Hormuz, a key route for global oil supply. Markets are reacting to geopolitical uncertainty rather than actual supply losses, with further price swings likely depending on whether tensions escalate or ease.
Société Générale argues the current oil shock is driven more by disrupted logistics and trade flows—especially around the Strait of Hormuz—than by a lack of production, making it more complex than past crises. As a result, recovery is expected to be slow and uneven, with market normalization potentially taking until the end of 2026.
Enverus estimates the Permian Basin now has about 55,000 drilling locations that break even below $50/bbl, up 10% year-over-year due to improved resource quality and cost reductions. Including all geologically viable zones, total inventory approaches 100,000 locations, with emerging intervals like the Barnett-Woodford driving the next phase of growth.
Oil futures are indicating sustained higher prices through 2026–2027 as markets price in ongoing geopolitical risk and tighter global supply. However, economists caution that history shows oil prices can reverse quickly if demand weakens or disruptions ease.
Oil prices dropped sharply as Iran signaled the Strait of Hormuz will remain open during the ceasefire, removing a major near-term supply disruption risk. Markets rallied on easing geopolitical tensions, though the situation remains fragile with ongoing Israel–Hezbollah tensions and a time-limited truce.
