Upstream Oil and Gas Deal Value Drops Amid Price Uncertainty
The global upstream oil and gas sector experienced a significant decline in deal value in March 2026, according to industry data from Rystad Energy. Despite a steady number of transactions, the total deal value plummeted to $5.55 billion from $32 billion in February, underscoring growing market uncertainty amid fluctuating oil prices.
While the volume of transactions remained near stable with 35 deals in March compared to 34 in February, the sharp decrease in deal value highlights cautious investment behavior. South America led global upstream activity, accounting for 55% of the total deal value, followed by North America with 16% and Asia with 13%.
The largest deal was Prime Infrastructure’s acquisition of SierraCol Energy for approximately $1.4 billion. Based in the Philippines, Prime Infrastructure’s move illustrates continued appetite from Asian investors for Latin American upstream assets. SierraCol, backed by Carlyle Group, produced an average of around 43,200 barrels of oil equivalent per day from September 2025 to January 2026.
In Colombia, Parex Resources secured the Frontera Energy portfolio for $725 million, outbidding Geopark’s earlier $601 million offer. This competitive bidding reflects ongoing interest in producing assets that offer near-term cash flow, despite the current softening in global oil prices.
On valuation trends, upstream resource prices have shown relative resilience in the first quarter of 2026 compared to the previous quarter. Producing assets held steady at an average of $4.6 per barrel of oil equivalent (boe), a slight increase from $4.5 per boe. Assets under development also saw a modest rise to $3 per boe from $2.5 per boe. However, discovery-stage assets experienced a dip in valuation, falling to $1.5 per boe from $1.7 per boe.
More indicative for deal-making are the prices paid for proved reserves. Valuations for proved (1P) reserves increased notably to about $10.5 per boe from $8.7 per boe in the last quarter of 2025, primarily driven by the Parex-Frontera deal. Meanwhile, proved-plus-probable (2P) reserves rose from $6.7 to $8.6 per boe during the same period.
Notably, North America’s monthly upstream deal value dropped below $1 billion for the first time in the reported period, reflecting a more cautious investment climate in one of the world’s major oil and gas producing regions. Despite the drop in deal values, the overall market maintains a strong pipeline of potential asset transactions.
Industry observers interpret these developments as a reflection of uncertainty in oil price trends, geopolitical tensions, and a shifting energy transition landscape, all influencing upstream investment decisions globally. Market players appear to favor assets with established production and cash flow, while valuations for early-stage exploration properties have softened amid risk aversion.
As the sector navigates these challenges, ongoing monitoring of deal flows and asset evaluations will be critical for stakeholders assessing the future direction of global upstream oil and gas investment.
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