As deal activity in the energy sector heats up, shares of energy companies have seen a rise. Notably, Southwestern Energy and Chesapeake Energy are in the final stages of a merger that would create a mammoth company worth approximately $17 billion. Once completed, this merger would make the new entity one of the largest natural-gas producers in the United States.

Mergers have become a common sight in the domestic oilfields, with Exxon Mobil agreeing to purchase Pioneer Natural Resources, and Chevron sealing a deal to acquire Hess.

The surge in natural-gas futures has paralleled the turn of colder weather across much of the United States following an unseasonably mild December. This has propelled natural-gas futures to their highest levels since November.

In other news, West Texas Intermediate crude for February delivery experienced a notable increase of $1.62, or 2.2%, reaching a settlement price of $73.81 per barrel. This has led to a 3% weekly gain.

Commenting on the situation, Quincy Krosby, chief global strategist at brokerage LPL Financial, stated, "As of now, the oil market sees the Middle East conflict contained, because if they didn't you'd see oil futures surging higher."

Krosby further emphasized the potential risks associated with the U.S. engagement in the Red Sea and Iran's military presence. The presence of Iranian surrogates surrounding the United States raises concerns about the potential for mistakes and missteps in this complex scenario.

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