Every earnings season, we pay particularly close attention to commentary from the major oil-field service companies—Schlumberger (NYSE: SLB), Halliburton (NYSE: HAL), Baker Hughes (NYSE: BHI) and Weatherford International (NYSE: WFT)—because their extensive operations give them insights into key trends throughout the energy value chain.

Their conference calls also occur relatively early each earnings season; the read-throughs gleaned from the proceedings can provide insight into emerging opportunities and potential pitfalls.

Although we continue to pore over first-quarter results from the energy patch, comments from management teams in the upstream and oil-field-services industries underscore the potential for further efficiency and productivity gains in US shale plays.

Given the short development times needed to exploit these resources, drilling and completion activity in the US onshore market will continue to track oil price realizations and producers’ ability to hedge future output. These fluctuations will create investment opportunities in cyclical names, but timing will be crucial.

Our outlook for oil prices to remain lower for longer and the best US shale plays to take market share favors an overweight position in midstream master limited partnerships, especially those with the best-positioned assets, capable management teams and healthy balance sheets.