The oil market was already oversupplied when
Russia and OPEC failed to agree on output cuts
in early March. Analysts say Russia refused to
back even a moderate cut because it would
have only served to help U.S. energy companies,
which were pumping at full capacity. Stalling
served to hurt American shale-oil producers and
protect market share.
Russia’s move appeared to enrage Saudi Arabia,
which not only said it would not cut production
on its own but said it would increase output
instead and reduce its selling prices in what
became effectively a global pricing war.
In the time since, prices have collapsed.