In today’s lower-for-longer oil price environment, U.S. shale operators must be relentless in their pursuit of cost efficiency. The ability to deliver production with a breakeven price of $40 or less isn’t just desirable—it’s essential. That level of performance is only possible through structural cost reductions across drilling, fracing, facility development, and production operations.

Industry leaders like ExxonMobil, ConocoPhillips, Chevron, Diamondback, Devon, and Occidental are racing to optimize capital efficiency while sustaining inventory quality. But as basins mature and geology becomes more challenging, the key question becomes: Can these gains be sustained, or has the industry already picked the low-hanging fruit?

Below, we unpack how top U.S. oil executives are framing the push for innovation and structural cost reduction—and whether the momentum can last.

🔧 Structural Cost Reduction: The Cornerstone of Shale Success

ExxonMobil stands out in its aggressive approach to structural cost savings.

“We’ve fundamentally transformed the cost base of our company by delivering $12.7 billion of structural cost savings since 2019. This far exceeds anyone else in the industry.” — Jim Chapman, ExxonMobil

“We’re not just nibbling around the edges here… While others are just getting started, we’ve already removed costs at a monumental scale.” — Jim Chapman

With a target of $18 billion in structural savings by 2030, Exxon has shown how scale and capital discipline can drive sustainable breakevens, particularly in the Permian Basin.

“The capex that we’re spending is fairly flat as we continue to grow volumes… reflects the continued efficiency that we’re finding.” — Darren Woods, ExxonMobil CEO

Chevron has adopted a similar mindset, linking cost reductions with strategic portfolio management:

“We’ve targeted $2–3 billion in structural cost savings to be delivered by the end of next year.” — Mike Wirth, Chevron CEO
“Wood Mac data shows that we’ve got the lowest upstream breakeven in the industry.” — Mike Wirth

🚀 Drilling Efficiency: Record Speeds, But Diminishing Returns?

Diamondback Energy has taken well efficiency to elite levels, but leadership warns that further gains may be limited:

“We’re drilling average 10,000-foot wells in eight days. There’s not three, four more days to come out of those on average.” — Kaes Van’t Hof, President, Diamondback

“We’re picking up pennies now… we were able to pick up dimes and quarters. It’s where we are in the maturation cycle of depleting these resources.” — Travis Stice, CEO, Diamondback

“Technology and process efficiency gains are being outpaced by geology… it’s a natural evolution of a maturing basin.” — Travis Stice

Still, Diamondback is producing more with less:

“Our completions team is completing mid-3,000 feet per day on average… 100 to 120 wells a year per crew is achievable.” — Danny Wesson

“Through a lower share count, lower cost structure, and quality inventory, our breakeven oil price for the same free cash flow dropped $9/bbl from last year.” — Kaes Van’t Hof

⚙️ Technology and Execution: From Simulfrac to Smart Allocation

Devon Energy has emphasized technology adoption and execution speed:

“Technology is a core cultural pillar at Devon.” — Trey Lowe, CTO

In the Delaware Basin:

12% increase in completion efficiency
7% drilling speed improvement YTD
Reduction from 14 to 11 rigs while maintaining output

In the Eagle Ford:

“40% faster drilling speeds vs legacy operations… ~50% reduction in well costs… expected to save $2.7M per well.” — Devon Eagle Ford Case Study

“We are drilling the same capital, but with double the working interest.” — Clay Gaspar

🛠️ Operational Consistency: The Hidden Engine of Cost Savings

Occidental CEO Vicki Hollub attributes recent cost wins to steady, uninterrupted activity:

“Enhanced well designs and strong execution have resulted in a 15% improvement in drilling duration per well versus last year.”
“These achievements… have reduced our Permian unconventional well costs by more than 10%.”

“Maintaining steady operations continues to drive material capital efficiency improvements, which remain the most durable and impactful form of CapEx reduction.” — Vicki Hollub

Operations President Richard Jackson added:

“We’ve had a great failure reduction… downhole maintenance rigs dropped over 30% over the last two years.”

📉 Geologic Limits & the Cost Wall

Despite impressive gains, Diamondback’s leadership and others warn of the headwinds:

“The geologic headwinds are picking up… the basin has been well tested by 300+ rigs.” — Kaes Van’t Hof

“As you allocate dollars to lower-quality inventory, your natural decline will be impacted, and improvements get harder.” — Travis Stice

💰 Capital Efficiency Wins Across the Board

ConocoPhillips’ leadership is equally focused on cost:

“We are finding additional opportunities to enhance capital efficiency and reduce costs… delivering the same volume for less.” — Ryan Lance, CEO

“We delivered 15% more scope at similar rig and frac activity counts… that means more feet drilled, more stages per day, more wells online.” — Nick Olds, EVP

🧩 Conclusion: Is $40 Oil the New Normal?

The top U.S. operators are proving that shale can survive—and thrive—at $40 breakevens. But maintaining this requires more than just drilling faster. It demands: