UBS Says It’s Time to Lean into These 2 Natural Gas Stocks — Here’s Why

TipRanks

Fri, May 16, 2025, 3:14 AM 7 min read

Despite each the speech astir shifting toward ‘green’ oregon renewable sources, earthy state remains a invaluable resource. The US, for example, is some a large user and a large shaper of the cleanest-burning of the fossil fuels.

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In theory, the US tin conscionable each of its state needs from home production; successful practice, owed to limitations of infrastructure and transport, the state meets its needs done a operation of home accumulation and imports, portion simultaneously exporting state for the satellite markets.

The US state system is based connected 2 large accumulation regions, the Marcellus Shale of the Appalachian Mountains successful Pennsylvania, Ohio, and West Virginia, and the assorted hydrocarbon-bearing formations crossed Texas, Louisiana, and New Mexico. These states nutrient much than 75% of each US earthy gas.

This robust instauration – and the comparative insulation from lipid terms volatility – forms the ground for UBS’s affirmative stance connected the U.S. state sector. The concern slope sees earthy state arsenic a reliable avenue for returns, particularly arsenic debased lipid prices proceed to strain crude markets and trigger capex cuts among lipid producers.

UBS expert Joseph Parkhill underscored this constituent successful a probe enactment pursuing a caller OPEC+ update: “We refresh our assemblage views and $50-80/bbl script runs from past month. We saw the faster proviso summation arsenic bearish for crude lipid price, with the imaginable to nonstop WTI <$55. Conversely, we spot this arsenic affirmative for earthy gas, with the expectations for further lipid focused capex cuts starring to reduced associated supply. This supports our Nat Gas E&P > Oil E&P preference…”

With that successful mind, we’ve turned to the TipRanks database to instrumentality a person look astatine 2 earthy state stocks UBS is recommending. Here’s what the slope has to accidental – and wherefore these names whitethorn beryllium worthy a look.

EQT Corporation (EQT)

The archetypal banal we’re looking at, EQT, is 1 of North America’s large earthy state companies, with operations successful the accumulation and midstream segments of the industry. EQT has extended holdings successful the Appalachian portion of the US, tapping into the gas-rich Marcellus Shale formation. Specifically, the institution has ownership oregon lease rights connected much than 1,000,000 nett acres successful Pennsylvania and 600,000 nett acres successful West Virginia. In Ohio, EQT owns oregon leases different 150,000 nett acres successful the eastbound portion of the state, and is actively moving to make the Utica Shale accumulation region.