Have the American entrepreneurs who developed horizontal drilling and hydraulic fracturing—“fracking”—done their jobs too well? The increase in domestic crude oil production of 3.6 million barrels a day in less than four years, reversing almost four decades of decline, has created a spectacular macroeconomic anomaly—a crash in oil prices without a recession to cause it.

Now, in response to sharply lower prices, domestic oil producers have shed jobs and cut operating rigs by more than half. This has sent shock waves through...