US shale oil has given rise to a new price cycle in the oil market

When all oil was conv entional , the oil price cycle was long: high oil price s led to a sharp increase in investment in exploration and production, eventually resulting in excess production capacity and a fall in prices , pushing down investment and production capacity , etc. The result was long alternating periods ( around four years ) of high and low oil prices . But the US shale oil cycle is much shorter: when prices are high, investment rises quickly and production increases after three quarters. This generates a short price cycle on top of the previous long cycle, as can be seen at present.