Frack-first energy policy is running into some good old-fashioned capitalism. Liberty Energy, the company founded by now-Energy Secretary Chris Wright, is prepping for a slowdown in shale drilling—despite President Trump’s best efforts to pump America into oil supremacy.

CEO Ron Gusek, speaking at the Super DUG Conference, offered a reality check: “I’m certainly not in the camp of a 100-rig-count reduction… maybe it’s in the 30 to 40 range,” which translates into 10 to 15 fewer frack crews. Not a collapse, but definitely not a stampede to drill either.

That’s because while Trump’s “Drill, baby, drill” mantra may play well on stage, shale drillers are singing a different tune off-mic. Oil’s trading at around $70, and that’s just not enough to support a responsible production spree. Gusek himself told The New York Times in January that while the mood was upbeat, it was “too early to say” that the Trump bump would move the needle on activity.

In fact, U.S. production growth slowed sharply last year—up just 300,000 bpd compared to triple that the year before. Even the Permian, America’s last great growth engine, is expected to carry most of the burden as other regions begin to sputter.

Trump, meanwhile, has tied his foreign policy ambitions to cheap oil. The idea? Flood the market, tank prices, and force Russia to the table over Ukraine. But low prices could end up hurting U.S. shale more than it hurts Moscow.

Financial discipline is still the name of the game in the shale patch. Operators, having been burned before, are refusing to chase volume without price support.

By Julianne Geiger for Oilprice.com

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