Low oil prices may lead to the bankruptcy of independent U.S. shale oil companies

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　　According to a recent report by Crude Oil Opportunities Network, while oil and gas companies such as TotalEnergies and Saudi Aramco believe that the energy demand generated by artificial intelligence data centers will act as a support for oil prices, the U.S. Energy Information Administration (EIA) and some financial institutions think that oil prices could drop significantly by 2026. If WTI prices remain below $49.35 to $50.17 per barrel for two consecutive quarters or more in 2026, independent producers in the U.S. shale industry will go bankrupt one after another. 　　For most independent U.S. oil and gas companies, $50 per barrel is a tipping point: at this price, the cost of drilling a new well exceeds the lifetime revenue generated by the crude oil it produces. In its Short-Term Energy Outlook, EIA predicts that the average price of WTI will be 51.42 dollars per barrel in 2026, a significant drop from the estimated 65.32 dollars per barrel in 2025. In an environment of low oil prices, although oil and gas companies in the Delaware Basin and Midland Basin in the United States are able to maintain stable production at a price level of $45 per barrel, the extraction costs in those areas need to be around $55 per barrel to be profitable; this means that such companies will face substantial losses. Other basins with longer production histories are expected to experience a daily production decline of 100,000 to 150,000 barrels, as these oil and gas companies, facing low oil prices, will focus on improving and increasing production at the wells with the highest efficiency while selectively abandoning other wells. 　　At the same time, low oil prices will accelerate M&A. If WTI falls below $54.84 per barrel, in the first half of 2026, over $50 billion worth of M&A activities could take place solely in the shale sector, with major oil companies acquiring assets from independent producers with negative cash flows.