The U.S. shale oil industry is slowing as logistical challenges including labor costs and a lack of adequate pipeline capacity pile up, the chief executives of some of the largest production and oilfield services companies have warned this week.

Evidence is accumulating that the boom in the industry that began two years ago is cooling off, particularly in what has been its incandescent center, the Permian Basin of western Texas and eastern New Mexico.

At a Barclays conference in New York this week, the chief executives of Schlumberger and Halliburton, the world’s largest and third-largest listed oilfield services companies, both highlighted a slowdown in the number of new wells being brought into production. Jeff Miller, CEO of Halliburton, talked about a “decrease in customer urgency” that had put pressure on the prices the company could charge in several parts of the U.S.

Along with project delays in the Middle East, he added, the slowdown would cut eight to 10 cents from Halliburton’s third-quarter earnings per share, which had been expected to be about 52 cents. Halliburton’s shares closed almost 6% lower after Miller’s statement on Sept. 5.

Paal Kibsgaard, his counterpart at Schlumberger, similarly warned that the North American market for hydraulic fracturing had “already softened significantly more than we expected” in the third quarter. The Permian Basin in particular, he said, faced challenges that he expected to “have a dampening effect on production growth, wellhead prices and investment levels in the coming year.”

On the morning of Sept. 6, shares in Weir Group, a UK engineering company, fell 7% in early trade after it warned of a “considerable softening” in U.S. demand last month, and some “deferrals” on orders from oil and gas companies. The company makes the pumps that are used in the shale industry for hydraulic fracturing: pumping a mix of water, sand and chemicals into wells at high pressure to open cracks in the rock and release the oil and gas.

The shale industry has slowed even though U.S. benchmark crude has for most of the past four months been above $65 a barrel. Executives have highlighted the problems caused because much of the increase in activity during the industry’s upturn in the past two years has been concentrated in the Permian Basin.

Rising costs for labor and equipment, difficulties in disposing of the unwanted water and natural gas produced alongside the oil, and above all a shortage of pipeline capacity for taking crude from the wilds of west Texas to refineries and export terminals along the Gulf of Mexico coast have undermined the economics of oil production in the region.

Bill Thomas, CEO of EOG Resources, one of the largest U.S. exploration and production companies, told the Barclays conference: “When you’re focused on one basin, one play, it gets very difficult to continue high rates of growth.”

The rebound in the U.S. shale oil industry since 2016 has been remarkable, raising the country’s crude production by 1.5 million barrels a day in the 12 months to July. Industry executives are now debating whether the slowdown is just a necessary pause for breath, or a sign that the headlong growth of the past couple of years could be gone for good.

Kibsgaard argued that there might be a more fundamental problem with the Permian than the logistical difficulties causing the present slowdown. He emphasized the increasing prevalence of “child” wells, drilled close to older “parent” wells, and showed analysis from Schlumberger suggesting that they delivered lower production, when adjusted for their length and the weight of sand used in hydraulic fracturing to bring them into production. He concluded: “This suggests that the Permian growth potential could be lower than earlier expected.”

Miller of Halliburton, however, was more upbeat about the long-term outlook for U.S. oil and gas, saying that despite the immediate problems, “we are still in the early innings of a strong North America cycle.”

Thomas said EOG’s expectation for the Permian Basin was “probably a little bit more subdued on growth than most people would have it.”

He added: “It’ll grow certainly for the next few years, but it’ll grow at a slower pace every year and won’t be the thing that’s going to destroy oil prices again because it’s going to grow so fast.”

However, Trisha Curtis of Petronerds, a research group, said that even if Kibsgaard was right about slowing productivity, that simply set up a spur for fresh innovation in the industry.

“People have kept saying ‘this is a problem the industry can’t solve,’ but somehow the industry has always found a way,” she said. “That is the challenge, but it is also the opportunity.”

Additional reporting by Camilla Hodgson.