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Good things happen when you put smart investors in a room and get them to talk. Last week we brought some of the best in the industry together for EnergyEdge in New York to discuss “What is the most compelling opportunity in energy for 2026?” Amidst the 79 slides, personalities, opinions, and a bit of talking their book, a few themes jumped out.
For starters the sentiment towards oil was clearly bullish (slide 34). The arguments varied: “we’re clearing the OPEC surplus”, “we’re exhausting tier 1 shale inventory” (slide 37), “the majors are failing to replace reserves”. Or maybe everyone pre-read the memo that its “black gold” and trading at a 50-year low relative to the shiny stuff. Whatever the reasoning, hope is back in the oil trade.
But how do you play it? That’s where the bets diverged. Do you take tier 2 Permian over anything else? That’s where history might guide you. But there was more on offer than that: Second tier basins, transfer shale technology to mature but thick conventional fields, export the technology to shale basins further afield (its not just the Vaca Muerta that could work), or take a bet on forgotten international assets. We heard pitches for all of it, and consensus on none.
You notice an appetite to go abroad in those ideas, and with them opposing perspectives on geopolitical risk (slide 16). Some noted increased uncertainty in the US, while others noted an underappreciation for pre-existing geopolitical risk in other parts of the world. What was consistent? The world feels less safe and there is a premium to be paid (and earned) by getting it right.
In power, the hot spot was the pace that power assets, and in particular gas-fired power assets, have repriced. “It is unlike anyone has seen in power before” one longtime investor stated. Given that these assets have tripled over the last couple years, that observation isn’t much of a surprise. But does it mean valuations have topped out?
Yes, power is the life blood of data centers (slide 28) and the recognition that gas-fired generation is key to AI puts a floor value on valuations. And yes, these offtakers will take as much power as you can give them, as soon as you can get to them (at least for now).
But that’s also what’s driving the 40+GW of bring your own power (slide 8) and the surge of distributed power solutions (slide 27). Throw in the known policy risks (or opportunities) like an “emergency” capacity auction in PJM (slide 54), and unknown risks of risks as electricity affordability grows as a political issue, and it all gets very asset specific (slide 66). With more than 20 GW of gas fire capacity likely to change hands this year (slide 67), don’t expect the market for high-quality thermal assets to slow down in 2026.
Thoughts, questions or things we missed? Send me a note (or hit reply) - I would love to hear from you.