An Analysis of the Oil Oligopoly: Saudi Arabia and Russia in Economics

This report delves into the oil oligopoly formed by Saudi Arabia and Russia, examining their roles in the global oil market. It investigates the historical context of the oil industry, highlighting the shift from a competitive market to an oligopolistic one dominated by OPEC and key players like Russia and Saudi Arabia. The paper analyzes the economic dependence of these nations on oil, exploring the relationship between oil prices and their GDP. It also applies Game Theory to explain their strategic interactions and the drivers behind their cartelization. The report discusses the influence of various factors on international oil markets, including supply capabilities, market influence, and political considerations. The findings suggest that the cartelization is mutually beneficial, with Saudi Arabia leveraging its substantial oil production and Russia seeking a greater geopolitical and economic role. The report concludes with statistical models supporting the analysis of their behavior and impact on the world market.