$50-60 New Normal or U.S Shale Bubble?, page-645

• I have done my homework and I bet $220,000 that you are wrong that U.S tight oil has low capital costs (i.e. can grow production at $50-60 per barrel) WTI and that it can cap upside prices.
• It certainly is here to stay though.

Refer to all the previous points I have made backing this up.

1. The cash being burned in U.S tight oil is speculative built around a false narrative by executives enthusiastically sold by investment bankers for a % fee. This is typified by Scott Sheffield's implausible claims around Pioneer's acerage in the best play (the Permian). https://oilprice.com/Energy/Energy-General/Can-The-Permian-Outgrow-The-Giant-Saudi-Ghawar-Field.html It's not good economics driving production here - there are no accounting irregularities as either as all misleading statements come with a disclaimer. If you exclude enough of the costs of doing business and talk about EBITDAX and non-cash impairments a lot of people won't notice you aren't wearing any pants behind the podium. The accounts tell the truth and aren't pretty (though recent raisings have shored up balance sheets).
2. Efficiency gains were due to technology but these have run into physical limits (as evidenced by recent earnings calls) declining reservoir quality will over time trump these gains. As the sweet spots are drilled this will turn with a vengance, as it has in the Eagle Ford and Bakken leaving only the Permian to cover declines and production growth.
3. Efficiency gains were due to service providers running at a loss, many have gone bankrupt. These gains will also turn in reverse as producers attempt to kickstart an industry in depression and find what happens when they layoff a skilled workforce en-mass.

U.S. could grow production for a few years by over exploiting the Permian but it's a tiny fraction of world production and a drilling treadmill. All the other oil production will soon start relentlessly hitting it's decline curve while demand increases in line with global GDP.
You Australians are seeing how essential energy is to the economy, the present situation is concerning. Industry can't adjust to a step change in fixed input costs very well, the global economy is overindebted and best described as aenemic.
That's another story though.