The Gulf Coast’s energy economy in 2026 will be characterized by an expanding oil and gas sector, rising electricity demand and a high degree of policy uncertainty.
That’s according to LSU’s 2026 Gulf Coast Energy Outlook, released by the university’s Center for Energy Studies on Wednesday. The annual report provides an analysis of the Gulf Coast’s energy landscape and trajectory.
Policy whiplash tops this year’s concerns. The report points to dramatic federal swings on issues like offshore leasing, offshore wind, LNG export permits, tax credits and tariffs as factors that have the ability to delay or disrupt long-term capital planning decisions.
“Perhaps the largest item of discussion with stakeholders this year has come around policy uncertainty,” the authors write.
Oil and gas production, meanwhile, continues to expand. But that expansion isn’t driven by increased drilling; as a matter of fact, rig counts have fallen. It’s driven largely by efficiency gains and technological improvements.
Gulf Coast crude production climbed to 10.2 million barrels per day in August, and natural gas production reached 63.6 Bcf/d—both historic highs. The report projects continued growth through 2030 for crude and 2032 for natural gas.
“Both oil and natural gas production in the region are anticipated to experience a decade of growth even though oil and natural gas prices have been remarkably flat on an inflation-adjusted basis,” the report reads.
As for electricity, the report says markets are at an “inflection point.” After two decades of stagnation, demand for electricity is on the rise, with industrial expansions and a surge of interest in large-scale data centers being the two main drivers.
“Maintaining the region’s historically low electricity prices will require continued planning around resource adequacy and infrastructure,” the authors write.
Among the report’s other notable findings:
Since 2012, the Gulf Coast has attracted some $263 billion in energy-related manufacturing investment, with Louisiana accounting for 54% of that sum.
Energy transition projects—think carbon capture and hydrogen—now account for 41% of all new manufacturing announcements in the region.
Employment in Louisiana’s oil, gas, refining and chemical sectors is expected to remain relatively stable through 2028.
