Devon Energy misses first-quarter profit estimates on weak natural gas prices

May 5 (Reuters) - Devon Energy DVN.N missed Wall Street expectations for first-quarter profit on Tuesday, hurt by lower U.S. natural gas prices, sending its shares down 1.8% in after-markets trading.

U.S. spot natural gas prices at the Waha Hub in the Permian Shale in West Texas have remained in negative territory for a record 61 days in a row as pipeline constraints trap gas in the Permian region, the nation's biggest oil-producing shale basin.

Its average realized price for natural gas fell 32.2% to $1.68 per thousand cubic feet (Mcf).

Oil prices have climbed more than 88% this year on Middle East conflict and supply-chain disruptions, but producers have largely held back output amid geopolitical uncertainty, while Devon's total realized price, including cash settlements, fell 8.3% to $38.94 per barrel of oil equivalent (boe).

Devon’s all‑stock merger with Coterra Energy CTRA.N, announced in February, is expected to close on May 6, 2026 creating a U.S. shale producer with an enterprise value of about $58 billion.

Investment firm Kimmeridge in April urged the shale producer's incoming board to swiftly pursue asset sales, improve capital allocation and revamp executive pay to boost shareholder returns after its merger with Coterra Energy.

The shale producer said it will provide outlook for the full-year in mid-June 2026.

The Oklahoma City-based U.S. shale producer reported production of 387,000 barrels of oil per day for the three months ended March 31, down slightly from 388,000 bpd a year earlier.

The company expects production in the second quarter of 2026 to average 851,000 to 868,000 boe per day.

The company posted an adjusted profit of $1.04 per share for the three months ended March 31, compared with analysts' average estimate of $1.06 per share, according to data compiled by LSEG.