伯恩斯坦-能源：运用五大‘W’分析上游资本支出超级周-Bernstein Energy：Applying the 5 W s to an upstream capex supercyclewe are unconvinced-260615

15June2026

AmericasEnergy&Transition

BernsteinEnergy:Applyingthe5"W"stoanupstreamcapexsupercycle...weareunconvinced

BobBrackett,Ph.D.

+19173448422

bob.brackett@

MinnieXu

+19173448574

minnie.xu@

AnshikaBajpai

+19173448306

anshika.bajpai@

Today,weuseouroutlookforglobalupstreamoil&gascapitalexpenditures(Bernstein

Energy:GlobalUpstreamCapex2026...thequantityofcapexfallsnow...doesthequalityofcapexfollow?)toconsiderthecurrentenvironment.Westillseeapullbackof~$40bln

upstreamcapexin2026drivenbylaggingcompanyconservatisminuncertainoil

andgeopoliticalenvironment.PublicE&Psremaindisciplined,OFScompaniesarenot

materiallyresettingFY26guidancehigher,shaleproductivitygainsarehardertoachieve,andalargeshareofdiscoveredresourcesremainsundevelopedbecausethebarrelsarelong-

cycle,politicallydifficult,ornolongercheaptodevelop.

InapostStraitofHormuzworld,wewouldexpectperhaps~$560blnintotalupstreamcapexExhibit1,~$50blnmorefromourpreviousforecastinJan2026,whenBrent

averaged~$70/bbl.Today,Brentis~$90/bbl,butwe’dexpectplanningpriceshaverisentoatmost$70/bbl.

Inthisnote,weusethefive-Wframeworktoassessthelikelihoodofanupstreamcapexsupercycle.

1.WHYinvest?Cashflowisup,butreinvestmentappetiteisnot.HigherBrenthasimprovedE&Pcashflow,butinvestorscontinuetorewardcapitaldiscipline,buybacksandfreecashflowdurabilityoverproductiongrowth(Exhibit3-Exhibit7.

2.WHATbarrelsgetdeveloped?Roughly1/3ofthediscoveredresourcesoverthepastcenturyremainsundeveloped(Exhibit8)withdeepwater+barrelsleadingdiscoveries.Theproblemisthatthosedeepwaterbarrelsareincreasinglyhardertoconvertinto

supply(Exhibit9andExhibit10).Shalebarrelsarecontenttoplateau(Exhibit12)whileoilsandsbarrels(Exhibit13)needmoreclarity.

3.WHOwillinvest?NOCs,notpublicE&Ps,leadthenextcycle.ThemarginalgrowthbarrelisincreasinglycontrolledbyNOCsandstate-directedplayers,notU.S.shale

independents(Exhibit14-Exhibit16).

4.WHEREcancapitalgo?Thebestgeologyisoftenintheworstjurisdictions.

Manyofthelargestundevelopedbarrelssitincountrieswithhighfiscaltake,politicalinstability,sanctionsorweakruleoflaw(Exhibit17-Exhibit18)

5.WHENtoinvest?Usually,highoilpricestriggerasharppickupinrigactivity,butthatpatternhasbrokendownthistime,andwehavenotyetseenanyraiseofguidancefromoilservicesandequipmentcompanies(Exhibit19-Exhibit20).Upstreaminflationalsomeanscompaniesarespendingmoresimplytoholdactivityflat.

SeetheDisclosureAppendixofthisreportforrequireddisclosures,analystcertificationsandotherimportantinformation.Alternatively,visitourGlobalResearchDisclosureWebsite.

FirstPublished:15Jun202609:00UTCCompletionDate:15Jun202600:53UTC

BobBrackett,Ph.D.+19173448422

bob.brackett@

15June2026

Finally,wehighlightthatoilpricehasoutperformedE&Pequitiesyeartodate(Exhibit21).Thethesisofhigherforlongerpricesdrivingbetterthanhistoricvolumegrowthisnotonethatwefindresonating.

Insteadwe’dsuggestthatasweexitthecurrentcrisisandtheStraitreopens,thedominantthemewillbeacomfortableoilpricewithapowerfulfloor(refillingstrategicreserves

at$70+?)whereexcessfreecashflowisrapidlycollectedbyE&Psandreturnedtoshareholders.

AMERICASENERGY&TRANSITIONBERNSTEINlsocIeTecENeRAlECROUP2

BobBrackett,Ph.D.+19173448422

bob.brackett@

15June2026

AMERICASENERGY&TRANSITIONBERNSTEINlsocIeTecENeRAlECROUP3

BERNSTEINTICKERTABLE

12Jun2026

TTM

AdjustedEPSAdjustedP/E(x)

Ticker

Rating

Cur

Closing Price

Price

Target

Rel.

Perf.

Cur

2025A2026E2027E

2025A2026E2027E

APA(APA)

M

USD

37.02

40.00

62.6%

USD

2.837.206.4213.15.15.8

COP(ConocoPhillips)

O

USD

116.98

121.00

0.6%

USD

6.1813.8910.8818.98.410.8

CVX(Chevron)

M

USD

187.22

204.00

6.2%

USD

8.4316.5813.2622.211.314.1

DVN(DevonEnergy)

O

USD

45.31

59.00

9.1%

USD

4.1710.068.4310.94.55.4

FANG(Diamondback)

O

USD

192.13

241.00

5.7%

USD

4.5732.2127.2242.06.07.1

EQT(EQT)

O

USD

51.94

69.00

(29.4)%

USD

3.318.158.588.05.04.8

EOG(EOG)

M

USD

136.65

155.00

(9.6)%

USD

9.8818.9316.2513.87.28.4

KOS(KosmosEnergy)

M

USD

2.87

2.40

14.4%

USD

(1.58)1.130.75(1.8)2.53.8

KOS.LN(KosmosEnergy)

M

GBp

217.00

177.00

28.9%

GBP

(1.17)0.830.56(1.9)2.63.9

XOM(ExxonMobil)

O

USD

147.01

182.00

11.0%

USD

7.3716.3714.4919.99.010.1

SPX

7,431.46

EDME

1,570.59

O-Outperform,M-Market-Perform,U-Underperform,NR-NotRated,CS-CoverageSuspendedEQTestimateisReportedEPS;EQTvaluationisEV/EBITDA(x);

Source:Bloomberg,Bernsteinestimatesandanalysis.

INVESTMENTIMPLICATIONS

CapexdisciplineandanormalizingpricemightbeanattractiveentrypointforoilyE&Ps.WehaveoutperformratingsonFANG,COPandDVN.

BobBrackett,Ph.D.+19173448422

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DETAILS

SYNTHESIZINGTHE5“W”SWEEXPECTONLYTWEAKSTOUPSTREAMCAPEX

Itisreasonabletoassumesomewhathigherupstreamcapexthaninourpreviousforecast,asstrongerBrentpriceshave

encouragedsomelessdisciplinedoperatorstostepupinvestment,drivingagradualincreaseinto2027.OnceBrentpricesnormalizeto$75/bblin2028underourpricedeck,weexpectupstreamspendingtotrendloweragaintoourlongrunviews.

Ourcapexmodeltakesoilpriceassumptionsasastrongdriver,butdespitethepriceonthescreen(andrisksofhigherprices),wedonotuse,say,current~$90Brentforourcapexmodelaswedon’tbelieveplanningpriceshavefundamentallychangedinapostStraitofHormuzworld,especiallygiven(1)theuncertainty,and(2)thestrongdesireforthemarkettowantlowerprices.Wehavealwaysperhapsbelievedthatinflationwasclosertoapopulardelusionthanalawofphysics.Ourfavoriteauthor,PhilipK.Dick,argued“Realityisthatwhich,whenyoustopbelievinginit,doesn'tgoaway.”Apparentlyoileconomicscandefyrealityfornow.

Inanycase,weprovideour(unimpressive)capexforecastbelowreflectingourviewofthecurrentsituation.Thenweapplya5“W”frameworktosupportourview.

EXHIBIT1:Weforecast~$560blninupstreamcapitalexpendituresin2026including~$56blntowardexploration

GlobalUpstreamcapex($,bln)

(Bernsteinestimates)

1,000

800

600

400

200

0

$70brentin2026,$78in2027

Exploration

Int'lE&Ps

NationalOil

IntegratedEnergy

USE&Ps

Source:Companyreports,RystadEnergy,IEA,EIA,Bloomberg,Bernsteinestimatesandanalysis

WHY...

INVESTINUPSTREAMCAPEX?

becausereservereplacementultimatelymatters

Reservelives(exlongcycleprojectssuchasLNG)areunimpressiveamongstE&Psandintegrateds.Furthermore,shale

‘resources’havecreatedacomfortcushionthatwaslackingsay15yearsago(astronginternalconvictionthatresourcescanbemigratedtoreservesandthenoutthewellhead).Whilesignificantresourcesandreservesnodoubtexist,wenotethat

discoverieshavecollapsedinaworldofshaleandthatthebestdaysofdeepwaterandultradeepwaterareperhapsbehindus.

BobBrackett,Ph.D.+19173448422

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EXHIBIT2:Theworldhasdiscoveredabundantresources,largelyinshaleandshelf

Resourcesdiscoveredbyyear

250,000

200,000

150,000

100,000

50,000

0

1972spike:earlyNorthSeadiscovered&GoM

2000-2010+:USShale

~1988:NorthSea

established;Brazil;

Permian/USShelf

1884

1896

1900

1902

1904

1906

1908

1910

1912

1914

1916

1918

1920

1922

1924

1926

1928

1930

1932

1934

1936

1938

1940

1942

1944

1946

1948

1950

1952

1954

1956

1958

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

2022

2024

2026

Ultradeepwater(1500+meter)

Deepwater(125-1500meter)

Shelf(to125meter)

Land

Source:Rystad,Bernsteinresearchandanalysis

becauseE&Pshaveenjoyedhighercashflowsforthelastseveralyears(partlyduetoconsolidation)

WhileMiddleEastdisruptionisstillaQ2headwindtosomecompany'sproduction,theIranconflictwillultimatelycasemoreoverallcashflowduetohigherBrentprice.Inanycase,largecapE&Pcashflowshavebeenrelativelyimpressivesince

Covid-19days(instrongpartduetoindustryconsolidation).

EXHIBIT3:USmajorsoperatingcashflowisrisingthankstosupplydiscipline

USMajorE&Pshavemoreoperatingcashflow

80,000

70,000

60,000

50,000

40,000

30,000

20,000

10,000

--

20092010201120122013201420152016201720182019202020212022202320242025

XOMCVXCOPFANGEOGDVNAPABPTTEOXYOVV

Source:Rystad,Bloomberg,companyreports,Bernsteinresearchandanalysis

Despitethehighercashflow,capexspendinghassimplyreturnedtonearpre-Covidlevels.

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EXHIBIT4:Andtheywilltrynottobreakthisdiscipline

Andtheircapexspendingisnotlagging

60,000

50,000

40,000

30,000

20,000

10,000

-

20092010201120122013201420152016201720182019202020212022202320242025

XOMCVXCOPFANGEOGDVNAPABPTTEOXYOVV

Source:Rystad,Bloomberg,companyreports,Bernsteinresearchandanalysis

becauseshareholderswantit?

Ifwetracksharepricechangessincetheconflict,itshowsthemarket‘rewarded’thosereturninglessCFOtoshareholders.Wedon’ttrulybelievethecausalityiscorrect.

Ultimatelywebelievethatmoreleverednamesbenefitthemostfromrisingcashflow(allowingfordeleveraging,etc.).Wedon’tbelievethisisanywherenearasignaltocompaniestospend.

BobBrackett,Ph.D.+19173448422

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EXHIBIT5:Weakcorrelation,butcompaniesthatwerelessshareholder-friendlybasedon1Q26reportinghaveactuallyseenlargershare-pricegainssincethewarbegan.

SharepricechangeafterMar.1,2026

%

25%

APA

20%

15%

PR

10%EOG

5%

COP

CVXXOM

0%

0%20%40%60%80%100%120

Shareholderreturnas%ofCFOin1Q26

SharePriceChangevsShareholderreturnas%ofCFO

(SinceMarch1,2026)

OXYy=-0.0965x+0.1482

DVNR²=0.1976

OVVFANGBPTTE

30%

Source:Bloomberg,Bernsteinresearchandanalysis

Similarly,ifwelookatthecorrelationbetweensharepriceandshareholderreturnfrom2023totheoutbreakofthewar,thereisnoclear‘signal’frominvestors.

EXHIBIT6:andthecorrelationisweakerbeforethewarbegan

Sharepricechange

Pre-War:SharePriceChangevsShareholderreturnas%ofCFO

(From2023toFeb28,2026)

PR

BP

10%20%30%40%50%

CVX

COP

XOM

TTE

60%70%

60%

40%

20%

0%

Shareholderreturnas%ofCFO(2023-Feb28,2026)

EOG

DVN

(20%)

(40%)

(60%)

y=0.0053x-0.1106R²=1E-05

OVV

OXY

APA

FANG

80%

0%

Source:Bloomberg,companyreports,Bernsteinresearchandanalysis

AMERICASENERGY&TRANSITIONBERNSTEINlsocIeTecENeRAlECROUP8

Whilethereisacorrelationbetweencapexgrowthandshareholderreturns,itisrelativelyweakandisunderpinnedby3

nameswhohavebeenaggressivelyconsolidatingthePermianBasin(XOM,FANG,andPR).Ifanythingthemarketisrewardingreasonabledealmakingthatcreateslargerenterprisesthatofcourserequirelargercapitalprograms(evenforsimply

maintenancecapex).

EXHIBIT7:USE&P'shighcapexgrowthdoesnottranslatetohighshareprice

Capexgrowthvsshareholderreturn

SharePriceChange%(2023-2025)

XOM

COP

TTE

BP

OVV

CVX

EOG

FANG

10%15%20%25%30%35%40%

OXY

DVN

APA

CapexCAGR(2023-2025)

PR

y=1.6794x-0.1202R²=0.3222

100%

80%

60%

40%

20%

0%

-20%

-40%

0%5%

120%

.

Source:Bloomberg,Bernsteinresearchandanalysis

WHAT…

TYPEOFBARRELSTOINVESTIN?

Deepwaterandbeyond

Wehighlight(inaslightlydifferentlayout)thatinthesamewaythattheshallowwatertookshareofresourcesdiscoveredfromonshore,thedeepwater,andthentheultradeepwaterrose.The“freshest”discoveriesarethussomeofthemostcomplicated.

AMERICASENERGY&TRANSITIONBERNSTEINlsocIeTecENeRAlECROUP9

EXHIBIT8:Theworldneedsmoredeepwaterprojects

1884

1896

1900

1902

1904

1906

1908

1910

1912

1914

1916

1918

1920

1922

1924

1926

1928

1930

1932

1934

1936

1938

1940

1942

1944

1946

1948

1950

1952

1954

1956

1958

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

2022

2024

2026

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

Ultradeepwater(1500+meter)Deepwater(125-1500meter)Shelf(to125meter)Land

Resourcesdiscoveredbyyear

Source:Rystad,Bernsteinresearchandanalysis

Ultimatelymanypastresourcediscoveriesbecomeproducingfields(61%).Andasmallproportionareinprogress.Wedonotealargeinventoryofdiscoveriesthatliedormantandnevermoveforward(despiteimprovingtechnologiesandperiodically

attractiveoilprices).

EXHIBIT9:Ofthe~1.5trillionbblofresourcesdiscoveredgloballysince1900,about32%remainidle(atthediscoverystage).

32%ofdiscoveriesinlastcenturysitundeveloped

Lifecycleoftotaldiscoverdresourcesfrom1900to2026

Underdevelop

7%

Discovery

32%

P

roducing

61%

ment

Source:Rystad,Bensteinresearchandanalysis

Wedon’tbelieveinaninventoryof“shovelready”projectswaitingforamorecertainprice.Ultimatelywebelievethatmost

deepwaterdiscoveriesarebinaryoutcomes.Theyarelargeenoughtosanctionrelativelysoonorweretoosmalltobedeclaredaresource.Thatsuggestsarelativelypoorpipelineof“almostgoodenough”deepwaterresourcesthatsuddenlymove“intothemoney”.

BobBrackett,Ph.D.+19173448422

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[Inourblackbook(BernsteinE&PPrimer:SomedayYou'llNeedThisBook),wecompareprojectcyclesandexecutionchallengesacrossdifferenttypesofprojects.]

Atypicalgenericmajorprojectcycleindetail:Capexisspentforupto10yearsbeforefirstoil,whichcanthenrunfor15-30yearsatafairlyflatproductionprofile.

EXHIBIT10:Offshoreprojectsrequireheavycapexbeforeproduction

Source:Companyreports,Bernsteinanalysis

Shale

Weobservethatactivitytowardsshale(asdefinedbyfracspreadcountsandhorizontaloilrigs)iswellbehaved.ItrosefollowingCovid-19andplateauedduringtheheightsoftheinvasionofUkrainebyRussia.Ithastrackeddownsinceandisholdingsub

400evennowmonthsafterhostilitiesinIran.

EXHIBIT11:FracSpread&HzOilRigs

00

1200

1000

800

600

400

200

600

500

400

300

200

100

FracSpreadsHzOilRigs

Source:EIA;Bloomberg;Bernsteinanalysis

Theplateauingofactivitycombinedwithdeclines(androughlyflatproductivity)haveresultinginflatproduction.

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EXHIBIT12:Shalesupplyhasplateauedat~10mlnbopd

Shaleproductionbyquarterlywedge

kbod

Q32025E

Q12026E

Q32026E

Q12027E

Q32027E

Q12028E

Q32028E

1

12,000

10,000

8,000

6,000

4,000

2,000

-

Currentperiod:

0Q12025

Q12010

Q32010

Q12011

Q32011

Q12012

Q32012

Q12013

Q32013

Q12014

Q32014

Q12015

Q32015

Q12016

Q32016

Q12017

Q32017

Q12018

Q32018

Q12019

Q32019

Q12020

Q32020

Q12021

Q32021

Q12022

Q32022

Q12023

Q32023

Q12024

Q32024

Q12025E

0

0

0

0

0

0

0

0

-

Source:Enverus,EIA,BakerHughes,PrimaryVision,Bernsteinanalysisandestimates

Oilsands

Oneplacetowhichcapitalcouldflowisintooilsands.Venezuelahastheworld’slargestresourceandclearlypositive

momentumisoccurringthere.Canada(intermsofbitumen)rankssecondandhaspositivemomentumaswell(technologiesfocusedonmodulardevelopmentarebeingdeployedwhichhaveshortenedcycletimesandcapitaloutlaysatcomparablereturns).

Ineithercase,suchprojectsaretypicallyintegrated(upstreaminvestmenttiedtomidstreamtakeawayandperhaps

downstreamupgrading)andthuscapitalintensive,arelong-lived(andsosensitivetoprice,riskanddiscountrates)andinthecaseofVenezuelageopoliticallyconflicted.

We’dmeasurethesupplyresponsefromsuchregionsinthe0.1mlnbopdscaleincomingyearsandnot1.0mlnbopdscale.

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EXHIBIT13:VenezuelaandCanadaoilsandsresourcesaremassive

Countrieswithhighestprovedoilreserves

Blnbbl

CanadaIranIraqRussian

Federation

VenezuelaSaudiArabia

USLibya

350

300

250

Oilsandsaccountfor~96%ofCanada'sreserves

200

150

100

50

0

KuwaitUnitedArabEmirates

Source:EIStatisticalReview,Bernsteinanalysis

Everythingelse

Whatelsecanbeinvestedin?Ultimatelywhatremainscanbeseeninthechartabove-onshoreOPEC+producers.Wetacklethatbelowunder“Where”.

WHO

WILLINVEST?

Nationaloils(NOCs)arethelargestshareofcapex.

EXHIBIT14:Weexpectdevelopmentcapextotickupslightlyin2027,butremainbroadlyflatversus2025levels.

Developmentcapex($,bln)

%Growth

80040%

70030%

60020%

50010%

4000%

300-10%200-20%100-30%

0-40%

USE&PsIntegratedEnergyNationalOilInternationalE&PsGrowth

Source:Companyreports,RystadEnergy,IEA,EIA,Bloomberg,Bernsteinanalysisandestimates

BobBrackett,Ph.D.+19173448422

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Andarethelargestcomponentofcapexgrowth.EXHIBIT15:GlobalCapexForecast

$,blnDevelopmentCapex

%YoY

%Offshore

USE&Ps

%YoY

IntegratedEnergy

%YoY

NationalOil

%YoYReinvestmentrate

InternationalE&Ps

%YoY

ExplorationCapex

%YoY

%USonshore%Offshore

2026e

500

-8%

36%

92

-9%

79

-7%

214

-5%

36%

114

-11%

58

-6%

8%

49%

2027e

531

6%

37%

99

7%

87

10%

221

3%

34%

124

9%

62

8%

7%

49%

2020

338

-28%

34%

52

-48%

55

-27%

149

-19%

44%

82

-24%

51

-5%

13%

50%

2025

540

-2%

35%

101

-1%

85

-7%

226

0%

40%

128

-3%

62

0%

10%

48%

2024

551

4%

35%

102

-8%

91

12%

226

7%

36%

132

5%

62

6%

10%

48%

2021

372

10%

32%

63

21%

52

-4%

163

9%

27%

92

13%

54

6%

12%

53%

2023

528

16%

32%

110

12%

81

26%

212

13%

32%

125

18%

58

-1%

11%

46%

2022

457

23%

31%

98

55%

64

23%

188

15%

22%

106

15%

59

8%

11%

50%

Source:Companyreports,RystadEnergy,IEA,EIA,Bloomberg,Bernsteinanalysisandestimates

WeknewNorthAmericaE&Premainsdisciplined.U.S.operatorsmayraisecapitalselectively,buttheyarenotabandoningcapitaldiscipline.

EXHIBIT16:WeexpectthedeclineinUSonshorecapexseenin2025toacceleratein2026

$,bln

%Growth

60%

40