Full Disclosure:​

M&A megadeals in the energy sector​

By Jaysen Sutton​

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Hi Reader 👋🏽,

Energy plays a huge role in the global economy, and it makes a lot of money for law firms.

The price of oil is influenced by supply and demand. Put simply, prices go up when there is more demand than the supply available. Prices go down when there is more supply than demand. Right now, oil prices are falling thanks to record supply by the US.

The irony is that the news coincides with COP28, the United Nations Climate Change Conference, currently taking place in Dubai, and the growing scrutiny of Big Oil. It’s hard for the US government to tell other countries to move away from fossil fuels when the US is producing more oil than ever. It’s also hard when the largest oil companies pour billions into lobbying. It is perhaps unsurprising that their representatives showed up in droves at COP28.

Since the pandemic, oil companies have made huge amounts of money, benefitting from high oil and gas prices after Russia’s invasion of Ukraine. Consolidation is taking place in the sector (AKA big oil companies merging together), with Chevron’s takeover of Hess and ExxonMobil’s acquisition of Pioneer.

How does it impact law firms?

With the slowdown of M&A deals, many US law firms with strong energy practices have benefitted from these megadeals. Paul Weiss is advising Chevron, Wachtell is advising Heiss and Fried Frank is advising Goldman Sachs (as lead financial adviser to Hess). Meanwhile Davis Polk is advising Exxon, while Gibson Dunn has been instructed by Pioneer.


Have any thoughts? I'd love to hear your perspective below!

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