The US oil fracker's dilemma: crouch or pounce?

Houston

US SHALE oil producers, having weathered the worst price plunge in their industry's brief history, now face a dilemma: whether to stay in a defensive crouch after slashing their rig fleets, or start drilling more wells to capture a partial recovery in prices.

In a way, the conundrum is as old as the first oil well. If producers start pumping more crude, as some executives have said they might do if prices edge a bit higher, they risk contributing to another slump in a fragile global market; if they hold back, they forego regaining revenue lost during a price slide of 60 per cent that started in June.

Yet it is also a changed world.

For decades the global industry has been dominated by a handful of mega-majors, which made shifts to the su…