Dallas Fed survey finds first quarter oil and gas activity rose

NEW YORK, March 25 (Reuters) - Activity in the U.S. oil and gas sector in the key producing states of Texas, Louisiana and New Mexico increased in the first quarter of 2026 although output was steady for now, a survey released by the Federal Reserve Bank of Dallas on Wednesday found. It said oil executives were waiting to see where prices would settle over the next six months following volatility and supply disruption caused by the Iran war, but expected the focus on energy security to rise.

Prices need to hold for two to three months before large companies adjust their plans, Kunal Patel, a senior business economist at the Federal Reserve Bank of Dallas, said on a media call.

Costs increased at a slightly faster pace when compared with the fourth quarter, respondents to the survey conducted between March 11 and 19 said. Of the 135 respondents, 92 were exploration and production firms and 43 were oilfield services firms, the Dallas Fed said.

Companies expect a West Texas Intermediate oil price of $74 per barrel at year-end 2026, the survey showed. WTI prices averaged $94.63 during the survey period, Patel said.

Respondents also foresee a Henry Hub natural gas price of $3.60 per MMBtu at year-end 2026. (Reporting by Siddharth Cavale in New York; Editing by Chizu Nomiyama and Barbara Lewis)