Lower oil prices have forced energy companies to shut down many of its least profitable rigs.

However, actual oil production has yet to fall as the active rigs are substantially more efficient and cost-effective.

As such, Goldman Sachs analysts are convinced prices will go a lot lower, and will need to stay low  in order to get to the point where rig shutdowns lead to a significant pull back in production. From Goldman:

While US [exploration and production companies] are indicating a greater focus on reducing capex and balancing capex and cash flow, we expect that lower prices will be required in order for the capex guidance and rig cuts to materialize into sufficiently lower US production growth given: (1) we expect high-grading to become more apparent, translating into more production per rig in the most efficient counties, (2) the current rig decline can reverse given flexibility in cutting and bringing back non-contracted rigs (at a lower cost and with hedging), and (3) rising uncompleted well backlog leaves risk to our bottom-up production growth estimate as skewed to the upside at higher prices and into 2016. Finally, our larger cost deflation expectation vs. company guidance also leaves risk to production growth as skewed to the upside for the same capex/cash flow financial balance.