I’m interested to know opinions on oil and gas pricing for year 2025. Obviously, the more substantive supporting facts provided, the better.
It depends upon who you ask.
No one knows for sure, but there are many sources to compare.
Your royalty results will depend upon the contracts your operator has with their carrier, post production costs, your lease terms, etc. so take any estimates as only a guide.
I look at the Short Term outlook on https://www.eia.gov/outlooks/steo/ They come out monthly.
Another useful source are the regional banks. I watch the Haynes Boone Energy Bank Price Deck survey which comes out in the spring and fall.
Haynes Boone Energy Bank Price Deck Survey Slides - Fall 2024.pdf (730.6 KB)
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If anyone knew the definitive answer, theyd make millions in the stock market
EOG and Chevron speak this week at a conference. NatGas: EOG did not peg a price, but said 1/7/24 they expect gas demand to increase 4% annually 2025-30 (20-24 BCF) due to the new LNG plants in construction & demand from utilities & data centers, despite gas inventories are at 5-year highs. Oil is unpredictable IMHO, EOG identified both bullish & bearish factors, US inventories are low and Trump may sanction Iran/Venezuela, but OPEC plans to restore production curtailments in April, Trump tariffs may affect economies, Chinese demand is weak but may stimulate their economy, I think Saudi Arabia will take barrels off the market if oil drops too much.
Recap of Dallas Fed survey released 1/2/25: “On average, respondents expect a West Texas Intermediate (WTI) oil price of $71 per barrel at year-end 2025; responses ranged from $53 to $100 per barrel. When asked about longer-term expectations, respondents on average expect a WTI oil price of $74 per barrel two years from now and $80 per barrel five years from now. Survey participants anticipate a Henry Hub natural gas price of $3.19 per million British thermal units (MMBtu) at year-end 2025. When asked about longer-term expectations, respondents on average anticipate a Henry Hub gas price of $3.63 per MMBtu two years from now and $4.16 per MMBtu five years from now. For reference, WTI spot prices averaged $70.66 per barrel during the survey collection period, and Henry Hub spot prices averaged $3.04 per MMBtu.”
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ymmv, I just go with the 12 month strip, which in my head is just the betting line on oil prices at any time. You get the same sort of answer. Around $70 for 2025. Though the strip continues to be backwardated (i.e. negative slope) for the next 10 years. So essentially the next 12 months of strip at any time is just “5% lower than what the spot price is today”. That’s where the bookies are. Nobody willing to bet on oil long term.
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Ms. Barnes, the Haynes Boone link you reference only shows fall of 2024, is there a link that allows for you to follow each month or quarter?
The report comes out in the spring and fall.
There are a lot of Pipelines being built in Texas and Railroad construction related to shipping oil and storage being built for oil. Prices for this construction is only going to get more expensive and that will have an effect on prices.