Trade policy changes are likely going to reshape the landscape for mergers and acquisitions (M&A) in the energy sector in 2025. Navigating this shifting terrain will require adaptability and a good understanding of global dynamics. From geopolitical tensions to technological advancements, the stakes are high, but the opportunities are abundant for those who prepare strategically.
The energy industry is no stranger to uncertainty. Ongoing conflicts in Ukraine and Gaza, coupled with China-West tensions, continue to ripple across global markets. Meanwhile, the recent U.S. presidential election ushers in a new administration, poised to implement a business-friendly agenda that could include reduced red tape, lighter antitrust scrutiny, and corporate-friendly tax policies to create a more accommodating regulatory environment. Such conditions often provide the stability and predictability that fuel M&A activity, encouraging businesses to pursue deals with confidence.
The Energy Landscape is Evolving
Oil and gas deals are likely to benefit from these changes. Eased regulatory pressures, including environmental and antitrust oversight, could streamline transaction processes, making it easier for companies to consolidate or expand their operations. Early indicators suggest that optimism is already translating into action. In the three weeks following the U.S. election, energy-sector deal activity on Datasite, which annually facilitates close to 15,000 transactions, was up 9% year-over-year.
Yet, this optimism exists alongside growing challenges. Restrictive trade policies—including tariffs, and export controls—can complicate cross-border deals and supply chain logistics. Energy companies reliant on global supply chains must grapple with higher costs and increased compliance burdens. These barriers could limit deal opportunities and force businesses to rethink their strategies.
Artificial intelligence (AI)-driven power demand is another factor reshaping the sector. With energy consumption by data centers expected to grow 10%-15% annually through 2030, companies are racing to secure resources and infrastructure. This trend could renew interest in nuclear power as a stable and carbon-neutral energy source. However, trade restrictions on critical materials like uranium or advanced reactor components could slow progress. Businesses must account for these variables when evaluating potential investments.
Renewable energy faces its own set of uncertainties. A new administration may seek to roll back provisions of the Inflation Reduction Act (IRA), altering the market dynamics for clean energy. Rollbacks could shift investment priorities, slowing progress in some areas while potentially boosting fossil fuel development. For renewable energy companies, maintaining flexibility and staying attuned to policy shifts will be essential.
Technology Ushers in a New Era for Energy
Technology offers a critical edge in this complex environment. Advanced tools like AI and generative AI can streamline M&A processes and reduce risks. For instance, AI-powered virtual data rooms (VDRs) can automate labor-intensive tasks, such as organizing and categorizing files for due diligence. These tools enhance accuracy, reduce human error, and help businesses meet regulatory requirements efficiently. With restrictive trade policies adding layers of complexity to deals, technology’s role in mitigating risks becomes even more vital.
Beyond operational efficiencies, technology can also support strategic planning. Predictive analytics, powered by AI, can help companies anticipate market shifts and identify emerging opportunities. By leveraging these tools, businesses can stay agile and ready to pivot as circumstances evolve.
Restrictive trade policies also underscore the importance of local partnerships and regional strategies. For example, companies may need to invest in domestic supply chains or form joint ventures to navigate tariffs and content requirements. These approaches can mitigate risks while fostering resilience in a volatile global market.
Energy M&A in 2025 will be shaped by a confluence of factors: geopolitical tensions, shifting trade policies, and accelerating technological change. The key to thriving in this environment lies in preparation and adaptability. Dealmakers must prioritize efficiency, leverage advanced technologies, and remain vigilant about policy and market trends.
For businesses, the path forward is clear: embrace proactive strategies, invest in resilience, and stay ahead of the curve. Restrictive trade policies may present challenges, but they also create opportunities for those willing to innovate and adapt. By focusing on readiness and leveraging the tools available, some energy companies can turn uncertainty into a catalyst for growth.
—Mark Williams is Americas Chief Revenue Officer at Datasite.
