Natural gas is a suitable alternative to gasoline and diesel fuels to decrease the carbon footprint of the mobility and energy sectors. Unburnt CH4 is typically removed from the exhaust using palladium-based catalysts, which suffer from thermal deactivation as well as water and sulfur poisoning. In this work, the activity of Pd/Al2O3 in wet lean CH4 oxidation was enhanced by applying repeated short reducing pulses (SRP) leading to a significant drop in the apparent activation energy compared to static operation. The degraded activity after thermal aging was also recovered by the same approach. Fit of time-resolved operando XAS data using kinetic models of oxidation revealed that only moderately active PdO exists under static operation, while during SRP operation highly active PdOx species are formed and maintained by the presence of metallic Pd. On the basis of the combined spectroscopic and kinetic data, we propose a practical range of Pd oxidation degree (25-65% Pd content) to preserve high CH4 conversion.