ConocoPhillips announced Monday it will buy Concho Resources for about $9.7 billion, making it the largest independent oil-and-gas company in the United States and a major player in the Permian Basin.
Pioneer Natural Resources is also in talks to buy shale rival Parsley Energy, according to the Wall Street Journal. These deals, alongside the recent acquisitions by Chevron and Devon Energy, signal an accelerating trend of consolidation in a market that is under financial duress after years of debt-fueled growth. However, experts do not expect the deals to save the industry in the long-term, which faces headwinds such as stubbornly low oil prices and the inevitable transition to renewable energy as evidenced by the European oil companies’ pivot to renewables.
This year alone, more than 50 North American fossil fuel companies with more than $50 billion in debt have filed for bankruptcy.