At the same time, oil and gas executives are signaling that they will be more selective in their choice of M&A targets and will carefully weigh the advantages and risks before finalizing the deals and committing their capital. This is supported by a slight dip in pipeline expectations from a year ago.
Oil and gas executives in the previous three years have targeted bottom-line synergies and access to new technologies as areas where they have derived the most value from completed deals. As they look ahead, oil and gas executives indicate that their focus will shift to unlocking new sources of growth through market expansion and top-line synergies.
While organic growth will remain the primary focus, executives will continue to pursue strategic M&A in the months ahead
As oil and gas executives survey the landscape in the months ahead, we expect they will continue to pursue growth opportunities by freeing up working capital and optimizing cash flow to boost liquidity, and by strategically pursuing deals that offer the right valuation and maximum return on investment.