Natural Gas Is Back on Wall Street’s Radar. Here’s Where the Opportunity Is Building
AI’s energy boom is giving natural gas a second act. Hotter summers, record LNG exports, and data centers hungry for reliable electricity are creating fresh pressure on supplies. Wall Street is catching on, putting a once-overlooked corner of the energy sector back in play.
Fueling the grid: Goldman Sachs sees an opening in natural gas stocks after the sector fell 12% from its mid-May peak. The bank now expects data centers to add 10–11B cubic feet of daily gas demand by 2030, up from its previous estimate of 7–8B. That stronger outlook has put Williams Companies, Kinder Morgan, and Kodiak Gas Services among its top picks, with all three rated Buy.
- Williams posted Q2 revenue of $3.05B, beating analyst estimates, with Goldman expecting its natural gas pipeline network to benefit from rising data center demand.
- Kodiak Gas is trading at levels Goldman believes give little value to its power business, while major project announcements expected later this year could provide further upside.
The Oil Spike Wall Street Keeps Sleeping On
Gas may be getting the attention, but oil could be where the bigger surprise is brewing. Fund managers Leigh Goehring and Adam Rozencwajg argue that today’s relatively calm market is hiding growing supply pressure. Global diesel inventories are running dangerously low, refineries across Russia, China, and the Middle East are producing less fuel, and US shale growth could soon turn negative.
- Brent crude is trading below $90 despite earlier forecasts for triple-digit prices, but Goehring expects oil to stay above $100 for much of 2027.
- Canadian oil sands offer longer-lasting production, with Canadian Natural Resources and Suncor Energy among the managers’ top picks.
Putting it together: Gas and oil are moving on different timelines, but the forces behind them are starting to line up. LNG exports have climbed since Freeport returned from maintenance, while total US gas demand is running 17.8% above last year. That gives natural gas a more immediate tailwind, while tighter oil supplies could take longer to show up in prices. For investors, both are worth watching as the energy market heads into 2027.