The 2020 oil price collapse placed a dagger in U.S. Lower 48 tight oil production and a myriad of constraints counters the idea of the sector returning to a growth trajectory. However, Wood Mackenzie analysts say ongoing developments like capital discipline, consolidation and well spacing will drive the U.S. tight oil sector toward growth again—eventually.

“We’re thinking about this in a real positive light because companies have the opportunity to get to a place where they're able to meaningfully de-lever and make good on those investments,” said Ryan Duman, Wood Mackenzie principal analyst of Lower 48 upstream. “While also evaluating complex operational decisions and the best sequencing and spacing choices for their individual assets.”

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