When America used a drone to take out an Iranian general a few weeks ago, it triggered a standoff between the two countries that barely moved oil prices. America was seen to have passed the first test of what Donald Trump hailed as ‘energy independence’. The US oil industry has surged over the past five years, making it the world’s biggest oil producer, and now a net exporter. The hope in DC has long been that this would turn the tide — not just on energy costs, but on the power dynamics in historically sticky relationships between democracies and dictatorships. By becoming energy independent, America decoupled itself from the Middle East; by exporting its energy, it was starting to liberate the world economy too.

But all along, America had a vulnerability. The Saudi, Russian and Iranian oil companies were either the property of the government or in the hands of their crony friends. By contrast, the US energy revolution took place in a competitive market whose innovation brought about the fracking technology that has made the era of shale possible. Yes, America’s fossil fuel industry is subsidised by tens of billions of dollars per year — a frustration shared by market purists and green activists alike — but the main drivers in the industry have been high-risk investment and competition between both big and small players.

But these smaller, independent companies followed the Amazon and Uber blueprints for world domination: run up huge debts and live on the promise of tomorrow’s profits. If those profits fail to turn up, America’s new energy champions might well collapse.

Concerns about the financial stability of American shale gas companies have been brewing for a while now, as the risk of bankruptcy in the sector has risen. The industry was resilient enough to keep oil prices stable in January, but it is struggling now that two of the world’s major oil players are deliberately knocking down prices. Diamondback Energy, an independent gas and oil company, saw its shares almost halve in value on Monday. Apache Corp, another one, has lost most of the market value it had this time last week. Even giants like Exxon and Chevron saw their shares price sprawling.

The Kremlin says its pockets are deep enough to withstand ten years of low oil prices; and none of this is new to the Saudis, who have used oil prices as a diplomatic tool for decades. It’s a typical price war, with each side thinking they can sustain losses long enough to win. But who will stand by the American shale companies? They won’t make money with oil at $33 a barrel.

This is the multi-billion dollar question facing the industry, now that Saudi Arabia and Russia have aimed their petrol pumps at each other. The Saudis tested US vulnerabilities with an oil-price war six years ago — and the US prevailed. It was painful, but companies made use of their free-market training by adapting and improving their processes. But as the US economy reels with fear of coronavirus, industry is more vulnerable than it would otherwise be.

Rex Tillerson, the former US State Secretary, once said that there’s a big difference between energy independence and energy security. It’s a point being made on world markets now — a gritty world of realpolitik where there is no such thing as a level playing field. America could get its hands dirty in a price war overnight if it felt so inclined, but it would require a huge overstep of the state into industry, a move that would grate with America’s attitudes towards business and entrepreneurship.

US dependency on foreign oil has been a worry for years. ‘This is not just an economic issue or an environmental concern,’ said Barack Obama on the campaign trail in 2008, ‘this is a national security crisis.’ So far, the US market model has put the country on the pathway to independence, but if the oil war escalates, no fracker — especially the little guy — is safe, and the sector will need another revolution if it is to stay afloat. If America treated its energy industry like it treats its military, it could not only join the cohort of petrol states — it could dominate them. But that’s not the American way.