In a simplified way, the story of the collapse of the Soviet Union could be told as a story about grain and oil.

That is from Yegor Gaidar. In the 1980s it was necessary to import more and more grain, and Saudi Arabia was no longer supporting oil prices. It worked like this:

The timeline of the collapse of the Soviet

Union can be traced to September 13, 1985. On this date, Sheikh Ahmed

Zaki Yamani, the minister of oil of Saudi Arabia, declared that the

monarchy had decided to alter its oil policy radically. The Saudis

stopped protecting oil prices, and Saudi Arabia quickly regained its

share in the world market. During the next six months, oil production

in Saudi Arabia increased fourfold, while oil prices collapsed by

approximately the same amount in real terms.

As a result, the Soviet Union lost approximately $20 billion per

year, money without which the country simply could not survive. The

Soviet leadership was confronted with a difficult decision on how to

adjust. There were three options–or a combination of three

options–available to the Soviet leadership.

First, dissolve the Eastern European empire and effectively stop

barter trade in oil and gas with the Socialist bloc countries, and

start charging hard currency for the hydrocarbons. This choice,

however, involved convincing the Soviet leadership in 1985 to negate

completely the results of World War II. In reality, the leader who

proposed this idea at the CPSU Central Committee meeting at that time

risked losing his position as general secretary.

Second, drastically reduce Soviet food imports by $20 billion, the

amount the Soviet Union lost when oil prices collapsed. But in

practical terms, this option meant the introduction of food rationing

at rates similar to those used during World War II. The Soviet

leadership understood the consequences: the Soviet system would not

survive for even one month. This idea was never seriously discussed.

Third, implement radical cuts in the military-industrial complex.

With this option, however, the Soviet leadership risked serious

conflict with regional and industrial elites, since a large number of

Soviet cities depended solely on the military-industrial complex. This

choice was also never seriously considered.

Unable to realize any of the above solutions, the Soviet leadership

decided to adopt a policy of effectively disregarding the problem in

hopes that it would somehow wither away. Instead of implementing actual

reforms, the Soviet Union started to borrow money from abroad while its

international credit rating was still strong. It borrowed heavily from

1985 to 1988, but in 1989 the Soviet economy stalled completely…

The money was suddenly gone. The Soviet Union

tried to create a consortium of 300 banks to provide a large loan for

the Soviet Union in 1989, but was informed that only five of them would

participate and, as a result, the loan would be twenty times smaller

than needed. The Soviet Union then received a final warning from the

Deutsche Bank and from its international partners that the funds would

never come from commercial sources. Instead, if the Soviet Union

urgently needed the money, it would have to start negotiations directly

with Western governments about so-called politically motivated credits.

In 1985 the idea that the Soviet Union would begin bargaining for

money in exchange for political concessions would have sounded

absolutely preposterous to the Soviet leadership. In 1989 it became a

reality, and Gorbachev understood the need for at least $100 billion

from the West to prop up the oil-dependent Soviet economy.