All of OPEC has been falling for the marketshare scramble for much of the last 30 years, this is a key reason why their ability to maintain pricing power has di

All of OPEC has been falling for the marketshare scramble for much of the last 30 years, this is a key reason why their ability to maintain pricing power has diminished. Whenever the price of oil falls below OPEC's established floor, Saudi Arabia (in theory) will be the OPEC member to cut their output. Historically Saudi Arabia has served as the world's swing producer. Each OPEC member had a specific quota they were allowed to produce with Saudi Arabia increasing and decreasing supply to maintain their target price. The problem is, as OPEC as a whole has lost marketshare to new reserves elsewhere in the world, individual OPEC members began to ignore their quota and go for marketshare, producing as much as they could. This was largely driven by local politics in the individual nations, since increased marketshare would deliver a short-term cash infusion. The Saudis are now tired of this. With US supplies now on the market, they've abandoned their role as the world's swing producer, leaving that task to America. America's producers are more market-sensitive, since they don't have sovereign reserves to fall back on, and more readily cut supply as projects become uneconomical in the face of falling prices. The great American oil boom of the past ten years has dramatically reshaped the power dynamics of the oil industry. So the Saudis have joined the rest of OPEC in the quest for marketshare, allowing the price of crude to enter a free-fall. They can outlast most of the rest of OPEC with their currency reserves so they're using this moment to slap the rest of them in the face for decades of defying OPEC policy. Oil isn't a dying market, conventional oil is a dying market.