US oil and gas shares will continue to gain as debt is paid off, analysts say

U.S. oil and gas producers will likely increase their capital spending by less than the rate of inflation in 2022, providing the fuel for another year of outsized gains for producers’ stocks as investors rediscover the sector.

Capital spending by U.S. exploration and production companies, or E&Ps — a list dominated by big independent shale oil and gas companies — is expected to increase 4.7% in 2022, S&P Global Market Intelligence data showed Jan. 14. According to the estimates of analysts surveyed by Market Intelligence, the net debt of the companies in the S&P Oil & Gas Exploration & Production Index will have been cut nearly in half — by more than $100 billion — between 2020 and the end of this year.

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