but I would think oil importing economies would benefit from the low prices.

But they get no say in the matter, since they have no control.

governments could purchase more for their strategic reserves while prices are low

Russia and Saudi Arabia produce about the same amount of oil, together they produce more oil then the next 10 oil producers combined. if an agreement is made restricting oil production, everyone else in the world can cheat, but if those two refuse to prices will stay up.

This all goes back to Syria. Both the House of Saud and Putin are backing opposite sides in that conflict. In that conflict is the export of Natural Gas from the Gas Field off the coast of Qatar. That field is divided between Qatar and Iran and both countries are building natural gas pipelines to Europe. One goes from Qatar, through Saudi Arabia, through Eastern Syria, into Turkey and then up the balkans to Europe. This pipeline is supported by Turkey, Qatar and Saudi Arabia.

The other pipeline, goes through Iran, into Iraq, through Syria and as originally planed under the sea to Cyprus and Greece and then to the Balkans. An alternative means of transport is via Turkey. This is supported by Iran, Iraq, Assad in Syria, Lebanon, Cyprus, Greece and Russia (With Greece, Lebanon and Cyprus dropping out if the Turkish route is agreed to).

Russia has admitted it has peaked its oil production but has maintained it oil production over the last five years. Saudi Arabia claims it has additional oil production capacity, many outside experts think otherwise, but Saudi Arabia has increased oil production over the last five years (But mostly heavy sour oil, not the Light Sweat Oil that is easy to process). Outside Experts think Saudi Arabia oil production is peaking, but Saudi Arabia has said that will NOT occur before 2030, the debate is not if Saudi Arabia oil production will peak but when).

Side note: Peak oil is NOT when a country runs out of oil, but the point where oil production starts to fall. In the lower 48 states, that happened in 1969, In Alaska in 1988 (and Alaska production is down to 1/2 what it produced in 1988, but still four times as much as it did in 1975 before the North Slope oil field opened up).



http://www.resilience.org/stories/2015-03-24/us-enters-undulating-crude-oil-production-plateau-in-2015

One of the aspects of Peak Oil is more expensive oil will become profitable, thus the recent increase in not only the Bakkan (in the Dakotas) and the Eagle Ford (in Texas) Oil fields, both know since the 1930s but only profitable when the price went above $50 a barrel after 9/11) but elsewhere as Stripper wells were drained of what ever oil their could produce (A "Stripper well" is an old well, whose main production was decades ago, but can still produce a couple of barrels of oil a month till this day, most wells in the US are Stripper wells, newer wells produce must more oil the older stripper wells but those newer wells will in time become stripper wells).

Please note, most "Peak Oilers" agree the world is in an oil glut and will remain so for for at least the next year:

http://www.resilience.org/stories/2016-03-07/peak-oil-review-mar-7

But they also note that the only countries NOT already producing oil "flat out" are Iran and Iraq and both are expected to increase oil production and exports over the next few years.

If the price of oil had NOT dropped in the last five years, the US MAY have become an net oil exporter in 2016 or 2017, but then return to being an importer. Do to the drop in the price of oil, the number of drill rigs working have dropped drastically since 2014 and Frack wells peak in about 18 months of opening up and then go into a steep decline and dry within five years of being drilled. Thus when the price of oil was high, a lot of wells were drilled, but once the price dropped, people stop drilling wells

The big cost in producing oil from those wells was the cost of drilling, thus once drilled it was better to sell whatever oil produced at whatever price you could get, then cap the well. At the low prices since 2014 you could NOT pay for the drilling, thus no new wells were drilled, but once drilled that cost is in the past and as long as the cost of PUMPING the oil was less then what the oil could be sold for, people pumped oil. If you can NOT max profits, you minimize loses and pumping oil and getting more then the cost of pumping but NOT the cost of Drilling minimize any loss. Thus oil is still being pumped from Frack wells drilled years ago, even through it is at a lost if you factored in the cost of drilling, but if you ignored the cost of drilling, the cost to pump that oil is lower then the going price of oil. Thus existing wells are pumping oil to this day, but no one is drilling new wells until the price of oil goes back up.

The cost to DRILL and PUMP oil from Oil fields in Russia, Saudi Arabia, Iran and Iraq are quite low. The key to any price increase is to increase the price of oil to a level, where fracking in the US remains unprofitable. Thus US oil production stays out of calculations as to the price of oil. Once that is agreed on, it is possible to fix oil production and thus the price of oil.

Remember, the top two producers, Russia And Saudi Arabia only needs cooperation of Iran and Iraq to get the price of oil up to just below the cost to drill a well in the US. The problem is Iran is presently in a "Cold War" fight with Saudi Arabia. Furthermore, Iran has an unofficial alliance with Russia (In many ways Putin went into Syria at the request of Iran to show Russia support for Iran more then any other reason). Iraq is closely allied with Iran (And thus with Russia) but the smaller Iraqi oil fields are under the control of the Kurds and what ISIS tried to take over (The main Iraqi Oil fields is in the Shiite dominated area around Basra, not Mosul and its nearby large rural Kurdish population).

Thus we are back to Syria and oil prices. Can Putin get Saudi Arabia to cut oil production and at what price? Putin will demand that Iraq and Iran be permitted to increase oil production, but Putin will give to Saudi Arabia an agreement that Russia production will be cut by whatever Iran and Iraq increase in oil production. That is the easy part, the hard part is Syria. Will Saudi Arabia give up its allies in Syria (ISIS) in exchange for more money for its oil? What will Putin offer, replacement of Assad but by another Alawite?

Assad is of the Alawite branch of Islam, they are considered heretics by most other Moslem (and sometimes called "Christians" by the Whabbist of Saudi Arabia for the celebrate the Christmas Holidays of Christmas and Epiphany, as well as the Persian Zoroastrian holiday of the Persian New Year). Alawites dominate along the Seacoast of Syria, just north of Lebanon and have controlled the Trade route with Iran for centuries. Alwaites are considered derived from Shiite Islam, but under Assad Father adopted more and more Sunni outward forms of worship.

Thus something is up and it is tied in with the Natural Gas pipelines from the Persian Gulf to Europe and both proposed lines go through Syria. It is also tied in with the need to increase the price of oil, but also the "Cold war" between Iran and Saudi Arabia. It will be interesting to see what happens, not what is put on paper but what both sides actually do.