The Dallas Fed's September 30 energy survey showed that oil and gas firms in its district continued to expand business activity in the third quarter, with oil and natural gas output increasing. According to Sina Finance, overall expansion slowed from the second quarter, while cost increases remained above historical averages and supplier delivery times lengthened further.

The survey found that the third-quarter business activity index fell to 38.8 from 46.1 in the second quarter, though it remained positive. For exploration and production firms, the oil production index rose to 20.7 from 15.0, and the natural gas production index increased to 14.8 from 3.7.

The survey was conducted from September 16 to 24 and included 125 companies, among them 83 exploration and production firms and 42 oilfield services firms, covering Texas, northern Louisiana, and southern New Mexico.

Equipment utilization improved as output growth supported oilfield services activity, but profit expansion slowed. The equipment utilization index rose to 41.9 from 31.9, while the operating margin index fell to 37.2 from 52.2 and the services price index declined to 16.3 from 24.5.

Cost pressure remained elevated. Exploration and production firms reported an exploration and development cost index of 41.5 and an oilfield operating expense index of 43.9. The input cost index for oilfield services firms eased to 60.4 from 64.4, but stayed high.

Supplier delivery times also lengthened, with the overall index rising to 36.2 from 31.7. For oilfield services firms, the index increased to 21.4 from 11.1.

Large producers said they would mainly use new cash flow to return capital to shareholders or owners over the next few quarters, while smaller firms said capital spending ranked first. Respondents also expected the average WTI crude price to be $88.38 per barrel at the end of 2026, below the survey-period spot average of $98.70, while the year-end Henry Hub natural gas price was seen at $3.29 per million British thermal units, above the survey-period average of $2.97.