U.S. shale formations to cut production by a record 570,000 barrels a day in 2016

In 2015, the fracking outfits that dot America’s oil-rich plains threw everything they had at $50-a-barrel crude. To cope with the 50 percent price plunge, they laid off thousands of roughnecks, focused their rigs on the biggest gushers only and used cutting-edge technology to squeeze all the oil they could out of every well.
Those efforts, to the surprise of many observers, largely succeeded. As of this month, U.S. oil output remained within 4 percent of a 43-year high.
The problem? Oil’s no longer at $50. It now trades near $35.
For an industry that already was pushing its cost-cutting efforts to the limits, the new declines are a devastating blow. These drillers are “not set up to survive oil in the $30s,” said R.T. Dukes, a senior upstream analyst for Wood Mackenzie Ltd. in Houston.
The Energy Information Administration now predicts that companies operating in U.S. shale formations will cut production by a record 570,000 barrels a day in 2016. That’s precisely the kind of capitulation that OPEC is seeking as it floods the world with oil, depressing prices and pressuring the world’s high-cost producers. It’s a high-risk strategy, one whose success will ultimately hinge on whether shale drillers drop out before the financial pain within OPEC nations themselves becomes too great.
end partial quote from:

Shale's Running Out of Survival Tricks as OPEC Ramps Up Pressure

 

And this is just the U.S. in 2016 and doesn't even include the cutbacks in drilling by U.S. companies, let alone cutbacks by shale oil companies around the world or worldwide drillers. So, the low prices in the 20s and 30s Saudi Arabia might withstand but not anyone else. Now they are talking (OPEC) that $95 dollar a barrel oil will not return until 2040. However, I'm not sure this is possible for the Saudis or OPEC to do in reality for a variety of reasons.

However, it is true until ISIS is defeated completely as a state these prices likely will remain this low in order to insure that ISIS doesn't overthrow any Sunni Muslim governments including Saudi Arabia's. 

The one government that might presently be threatened the most by ISIS is Libya which is still trying to stabilize after the assassination of Qaddafi.