U.S. Shale's Capital Discipline Outweighs Trump's Pro-Growth Rhetoric

Although corporate executives in the shale industry may be encouraged by the supportive rhetoric of President-elect Donald Trump and his incoming administration, a potential crude oil oversupply and a stagnation in well productivity mean they are less likely to boost drilling budgets. Operators are likely to cut back on Lower 48 drilling if prices stay below $70 per barrel.

Industry heavyweights such as Chevron and Diamondback have guided for more modest budgets and slower-to-flat production growth next year. For now, 'Shale 4.0’ priorities,…