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Monthly Production Stream: April

The market moved. The system followed.

Higher crude prices are pulling production forward.
That growth is bringing gas and NGL supply with it.
And infrastructure is starting to decide what actually clears.

This month’s discussion highlights:

Crude growth is returning, with conditions
WTI has reset higher, pushing production expectations up across the Permian and Bakken. Growth holds if pricing stays elevated, with private operators positioned to respond faster than publics. Pipeline capacity is already tightening.

Bullish crude is turning into bearish gas
Associated gas from oil growth is expanding supply and lowering marginal costs. That shift is already resetting longer term gas price expectations and pulling the market off prior bullish assumptions.

Demand growth is real, with upside risk
LNG remains the anchor, with more than 15 Bcf per day of expected feedgas demand. Data centers are emerging as a second layer of demand, particularly in Texas, with potential to scale beyond current forecasts.

NGLs are running into a bottleneck
Production is increasing alongside crude and gas, but fractionation capacity is tightening. As volumes grow, constraints at the frac level will determine whether supply clears or backs up.

Infrastructure is the lens for the entire market
Crude egress, gas takeaway, fractionation, and power delivery are shaping outcomes across commodities. The interaction between these systems is where pricing and performance start to diverge.

Capital is moving back into midstream
Recent transactions suggest rising competition for U.S. infrastructure assets, including interest from global capital. Valuation multiples are moving higher as a result.

Margins are exposed to spread compression
Kinetik’s marketing margins have closely tracked the Waha to Houston Ship Channel spread. As new Permian egress comes online in late 2026, that spread is expected to tighten, putting pressure on margins.