Dallas Fed Energy Survey

Price forecasts

West Texas Intermediate Crude

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Henry Hub Natural Gas

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Special questions

Data were collected  June 9–17; 125 oil and gas firms responded to the special questions survey.

All firms

How much U.S. crude oil production growth do you foresee in 2027 if WTI prices hold at $100, $125 or $150 per barrel?

The response most frequently selected by executives across all three price scenarios was “more than 0.25 but not more than 0.50 mb/d.” Respondents tended to indicate smaller production gains at the $100-per-barrel scenario and larger gains at the $150-per-barrel scenario.

At what price in dollars per barrel do you expect WTI crude oil to peak this year if the military conflict in Iran continues through year‑end?

About two‑third of respondents think West Texas Intermediate (WTI) crude oil would peak at $125 per barrel or less if the military conflict in Iran continues through year‑end. A smaller percentage of respondents selected higher price options.

When do you expect the military conflict with Iran to end?

Survey responses were collected during a period when the U.S. and Iran reached a memorandum of understanding (MOU). Responses have been divided into those submitted before the MOU announcement (on or before June 14) and those submitted after (June 15 or later). While third quarter 2026 was the most frequently selected option overall, following the announcement of the MOU a larger share of executives selected second quarter 2026.

How likely is it that Iran permanently restricts crude oil exports from the Persian Gulf?

A majority of executives view permanent restrictions by Iran on crude exports from the Persian Gulf as unlikely. Fifty‑seven percent of respondents say such restrictions are “unlikely,” while 33 percent consider them “somewhat likely.” Only 10 percent characterize permanent restrictions as “very likely.”

Exploration and production (E&P)

When do you expect natural gas takeaway constraints in the Permian Basin to be fully alleviated such that Waha natural gas (fixed) prices remain positive even during pipeline maintenance?

This question was posed only to exploration and production firms that indicated their operations are primarily focused on the Permian Basin. Most executives expect gas takeaway constraints in the basin to be fully resolved in 2027. The most frequently selected option was first quarter 2027, chosen by 25 percent of respondents.

To what extent might the following constraints hinder your firm’s drilling activity in the Permian Basin in the next 12 months?

This question was posed only to exploration and production firms that indicated their operations are primarily focused on the Permian Basin and that have drilled or completed a horizontal well within the past two years. Natural gas takeaway capacity and policy or regulatory issues emerged as the most frequently cited significant constraints.

To what extent might the following constraints hinder your firm’s drilling activity in basins outside the Permian Basin in the next 12 months?

This question was posed only to exploration and production firms that indicated their operations are primarily focused outside the Permian Basin and that have drilled or completed a horizontal well within the past two years. Across all listed constraints, few firms reported experiencing significant hindrance.

Special questions comments

Exploration and production (E&P) firms

• It is going to take more time to assess to what degree the energy business and markets are permanently reordered. We certainly have learned that it doesn't matter how much crude you can produce, it is meaningless if you can't get it to your customer in the normal course of business.
• The collision of AI development with local community activists rhymes with the early response to fracking. It's unclear how competitive we can be in the AI arms race unless we temper the rights given to NIMBYists (not in my backyard) and the legal maneuvers they use to stop progress.
• It is clear that the disconnect between commodity physicals and futures creates winners and losers. There is a lot of power in the hands of commodity traders that have the ability to control the price of a molecule that they will never touch. This is a risk factor that must be taken into account in future commodity pricing underwriting models.
• The Middle East situation will not mitigate overnight, nor will this ever go back to normal, whatever that may be. Our project is in the western U.S. in a strategic position to support military and government operations that are important for issues in the Pacific Rim. There is a global reset to hydrocarbon needs and sources. The Middle East is in the news, but the repercussions are worldwide. Energy of all kinds is needed and in demand worldwide, and the industry needs active support. Not everyone is operating in the Permian or engaged in shale development, nor do they want to be. Energy is both a national and international issue of concern.
• Availability of people and frack sand seem to be the first challenges currently.

Oil and gas support services firms

• I do not expect any clean resolution to the Iran war. This will likely be another decade-plus quagmire that will push inflation and add further instability to energy prices. This is the same as it ever was.
• Oil stockpiles have been drawn down, and they will likely take six months to refill.
• The question regarding U.S. oil production growth at high-price scenarios is mostly irrelevant at the time of this writing. In my opinion, the administration is setting up low oil prices for the next five to ten years. It will take six months to a year for it to play out.
• I believe the Iran conflict will be a long and complicated challenge that is not easily solved. The risk premium to Persian Gulf oil will continue.

Additional comments »

Historical data are available from first quarter 2016 to the most current release quarter.

Business indicators: quarter/quarter

Business indicators: year/year

Activity chart

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Comments from Survey Respondents

Survey participants are given the opportunity to submit comments on current issues that may be affecting their businesses. Some comments have been edited for grammar and clarity. Comments from the Special Questions survey can be found below the special questions.

Exploration and production (E&P) firms

• Middle East geopolitical tensions and shifts in U.S. tariff policy have contributed to broader shipping constraints and extended lead times for a few products. No oilfield shortages are evident at this time, but we are keeping a close watch on the evolving dynamic.
• Current political instability in oil markets due to the Iran war has crude oil and natural gas prices inflated. If there is a conclusion to hostilities, there will be continued confusion in the oil markets as normalcy may require time, but eventually calming oil markets will result in significantly lower prices.
• Once the Middle East conflict comes to end it will take 90 to 120 days for oil to settle back to around the $70-per-barrel range.
• Golly. What could possibly be affecting our business other than a COVID-sized supply gap driven by a war being commandeered by an administration that just cannot tell the truth? They jawbone the price down basically every Sunday evening. If they know Hormuz reopening isn't likely, it'll make the medium-term supply issue ten times worse.
• If the Iranian war hasn’t ended by the end of July, we will see the supply cliff hit, whereby all of the various releases from strategic reserves will have been used and actual physical shortages will start showing up. Then all bets will be off on oil prices.
• The Iranian war of course affects outlooks. I am confident that the administration is doing the right thing as to resolving the conflict. 
• Markets can price risk, but they can't price a tweet. The whiplash from diplomacy-by-social-media has become the single most unpredictable input in our planning. We don't need certainty about the future, just certainty that policy won't change between the morning and the afternoon.
• Prices are anyone’s guess.
• Under the current conditions with the Iranian war, it is hard to predict the price of crude oil with any amount of certainty. My guess is that we will see higher prices for both crude oil and natural gas for several months even with a ceasefire agreement.
• The market is too soft given today's circumstances. I put $82 per barrel for West Texas Intermediate, but I'll bet that's light.
• The increased cash flow means more drilling.
• The Hormuz uncertainty makes planning difficult. Service providers are taking pricing, which is also not encouraging for increased development in 2027.
• Costs are increasing due to fuel cost and higher demand. For the first time in my career, I had a pressure pump group come back to me asking how much over the proposed rate I would pay to secure a frack date. We went with a different vendor after this comment was made.
• The biggest issues are the lack of acreage and the cost of acquisitions. It's challenging for independents.
• Low natural gas prices have helped us reduce the cost of property acquisitions. Buy low and sell high, hopefully. The increase in liquefied natural gas exports is helping tremendously.
• The prospect that Iran will comply and conform with any agreement, written or oral, is, at best, wishing on a fantasy. Correspondingly, it is unlikely that Israel will elect not to act in what it considers to be it's own interest because it could threaten the peace, which is akin to wishing on a star without a star. In effect, I believe the degree of uncertainty remains substantial.
• Politics in the western U.S., specifically California, are distorting the market and negatively affecting investments. This is a major source of uncertainty reducing the energy available in the state.
• Geopolitical risk is still affecting industry at the upstream producer level, especially small undercapitalized companies.
• Rapid changes in international  geopolitics make for a cloudy windshield view of the future direction of  oil price and demand. We want to choose drilling prospects that are profitable at $50 per barrel.
• Regulatory compliance is becoming a major expense, with abandonment expense being significantly more burdensome for stripper production.
• The White House seems to prefer commotion and chaos to delivering meaningful, truthful information that serious business decisions can be made on.
• The Iran conflict, i.e., blockade of the Strait of Hormuz, is the wild card in speculating on future prices and development activity.
• It is disheartening to see Democrats reflexively wanting a return to the Windfall Profits Tax.
• We are not hedged in crude oil or natural gas production, so we are susceptible to monthly average spot pricing plus basin differentials (Gulf Coast of Texas). Given this, the first two quarters of 2026 have been highly volatile between the Winter Storm Fern event in January followed by the Iran war affecting oil pricing. We look forward to getting back to fundamentals when it comes to commodity pricing, allowing us to continue underwriting mergers and acquisitions deals with confidence and obtain the ability to better project cash flow.

Oil and gas support services firms

• Elevated oil prices are not directly translating into increased production or increased demand for oilfield services. Unprecedented geopolitical instability is leading to increased uncertainty.
• Predicting future operations given current conditions in all aspects of the business world, not just the oil and gas industry, seems to be next to impossible. Volatility remains the norm.
• Hoping for a new floor in the $70s to $80s per barrel as the Iran conflict looks like it wraps up.
• Uncertainty continues to cast a shadow on long-term structural planning, but the general outlook in two- and three-year timeframes is greatly improved.
• Artificial intelligence (AI) can do much, but AI can not drill a 30,000-foot well.
• As a service provider, we have seen pricing that has become much more competitive with the consolidation of the majors. We are seeing smaller service providers come in and slash pricing to unrealistic numbers. The majors are accepting these price cuts temporarily until they start to experience service problems and failures. It is very difficult for the established larger service providers to have to compete with this tactic of business.
• Business activity has increased in the second quarter of 2026 compared to both the prior quarter and the same period last year, driven by stronger demand for rental equipment and field services in the Midland and Delaware Basins. However, diesel fuel costs have risen sharply—up approximately 65 percent since January. This input cost pressure is partially offsetting strong revenue growth. We remain cautiously optimistic for second half 2026, though continued oil price increases could further compress margins if fuel surcharges cannot be passed through to customers.
• Fuel expenses have greatly increased over the past quarter, but equipment pricing is not keeping up with inflation. E&P consolidation has made an impossible environment to pass on ever increasing costs.
• Workover and well service activity picked up in the Permian Basin in late April and May. The pickup is not at activity levels that would be expected with where WTI prices actually were during that time frame but above the $55 to $60 per barrel level that was being used at the start of the year. With higher activity, the labor market has begun to tighten (must be legal to work in U.S. and pass drug test, which screens out a lot of applicants,) and thus the market for services has tightened slightly, allowing for small pricing gains in addition to fuel surcharges that went into place in Apri in all markets.
• We are activating equipment that stacked in fourth quarter 2023. Rates for services are increasing. Competition for experienced field crews is increasing, and customers are hiring our people.
• Activity is more likely to increase than decrease. Supplies of rental tools and services are tight and suppliers are demanding a return on investment. Capital decisions will be made based on a reward of a return, not the opportunity to supply.
• A fairly consistent theme is volatility and sector cost inflation, where commodity prices don't offset increased costs.