Increased production by the U.S. oil industry and a recent decision by the Organization of Petroleum Exporting Countries to maintain current levels of production could result in a crash in the domestic shale oil industry. A glut of oil, resulting in a drop in market prices, might make investment in new fracking operations unprofitable, energy industry insiders say.
The recent fall in the price of oil is only partially about supply and demand. Instead, it's about how OPEC is responding to the threat that U.S. oil production, particularly cost-intensive fracking, poses to its preeminence in global oil markets.
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