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7 Pages

Upstream M&A – timing the oil price bet

Upstream M&A – timing the oil price bet

Report summary

Being on the right side of the commodity price bet is central to creating value through M&A. Today's would-be acquirers view the current environment – low oil prices and a depressed M&A market – as an opportunity to do just that; to buy at the bottom of the cycle.

But how big is the upside? In this note, we compare the value of our Deal Pipeline under two oil & gas price scenarios: 1) our base assumption and 2) our base forecast. The difference is striking: Pipeline value doubles to US$150 billion under the forecast (vs. the assumption). The implication is that, for oil price bulls, the current market presents an opportunity to be on the right side of the commodity price bet: effectively, to buy at the assumption and 'sell' at the forecast. 

What's included?

This report includes 1 file(s)

  • Upstream M&A – timing the oil price bet PDF - 313.60 KB 7 Pages, 1 Tables, 4 Figures


This Upstream Oil and Gas Insight report highlights the key issues surrounding this topic, and draws out the key implications for those involved.

This report helps participants, suppliers and advisors understand trends, risks and issues within the upstream oil and gas industry. It gives you an expert point of view to support informed decision making.

Wood Mackenzie's 500 dedicated analysts are located in the markets they cover. They produce forward-looking analysis at both country and asset level across the globe, backed by our robust proprietary database of trusted research.

Proprietary data means a superior level of analysis that is simply not available anywhere else. Wood Mackenzie is the recognised gold standard in upstream commercial data and analysis.

  • The opportune time to acquire?
  • Quantifying the oil price gamble
  • Lessons from the past?
  • Appendix
    • Deal Pipeline

In this report there are 5 tables or charts, including:

  • The opportune time to acquire?
  • Quantifying the oil price gamble
    • Price Scenarios (US$/bbl, nominal)
    • Deal Pipeline valuations (US$bn, NPV10)
    • Forecast vs. assumption valuations: NPV delta (US$ bn) and return on investment* (%), deal by deal
  • Lessons from the past?
    • Deal-by-deal value destruction: purchase price / current WoodMac valuation (%) vs. Brent (US$/bbl)
  • Appendix
    • The deals
Requester's name : .............
Department : .............
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Wood Mackenzie, a Verisk Analytics business, has been a trusted source of commercial intelligence for the world's natural resources sector for more than 40 years, empowering clients to make better strategic decisions with objective analysis and advice.

We work across every sector of oil, gas, power, renewables, chemicals, metals and mining, covering more than 150 countries. Our proprietary data and models are at the core of everything we do, ensuring our independent asset and company valuations are thoroughly robust and that we offer an accurate forward-looking view of economic indicators such as market supply, demand and price trends.

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