Oil futures settled lower on Monday after key producers failed to agree on a production cap that could have tightened up supply, but prices pared much of their earlier losses following news that production in Kuwait has been more than halved due to a workers’ strike.

May West Texas Intermediate crude CLK26, settled at $39.78 a barrel, down 58 cents, or 1.4% on the New York Mercantile Exchange. The settlement was the lowest since April 8, but prices had suffered a bigger drop early Monday, losing by as much as 6.8% to trade as low as $37.61.

Meanwhile, June Brent UK:LCOM6 crude on London’s ICE Futures exchange also pared much of its losses to finish down 19 cents, or 0.4%, at $42.91 a barrel after a $40.10 low.

Oil prices were “saved” by the strikes in Kuwait, said Naeem Aslam, chief market analyst at AvaTrade.

Read: Kuwait workers strike helps prevent an oil-price collapse

The plunge the oil market saw when it opened Monday faded, but the “noise in the market” about the Organization of the Petroleum Exporting Countries is still coming, he said.

It isn’t just about supply and demand anymore, said Aslam. “This has changed into dirty politics where the cartel who should be responsible [for] oil price stability has taken responsibility [for] price volatility.”

News that Kuwait’s output has dropped by more than 50% as of Sunday on the back of an oil-industry employee strike provided some support for oil prices, which recouped much of the losses they suffered in the immediate aftermath of the producers meeting.

Kuwait’s output has reportedly fallen to 1.1 million barrels a day from nearly 3 million barrels a day because of the strike.

News of the strike came the same day Russia and heavyweight producers inside and outside of the Organization of the Petroleum Exporting Countries walked away from a much-anticipated meeting empty-handed. The group had gathered to discuss a production cap to limit output to January’s levels as a way ease the global oversupply.

Read:$30 oil ‘within days’—what analysts see for the market after Doha talks fail

Failed freeze

The key driver behind the breakdown was Saudi Arabia’s refusal to participate in the deal without its geopolitical rival Iran pledging to do the same. Since economic sanctions against Iran were lifted in January, the country has vowed to keep ramping up production until output is back up to at least 4 million barrels a day.

Read:Here’s why Doha failed to deliver an oil deal

Saudi Arabia and Iran had made their stances clear, but “Saudi Arabia clearly thought Tehran might come to the table at the 11th hour,” said Joe Rundle, head of trading at ETX Capital. “Longer term, it’s heard to see supply slowing much this year.”

Hopes for a deal were a main catalyst in a rally that lifted U.S. crude prices more than 50% from their February lows. Much of those gains are likely to get wiped out, as oil producers might be looking to increase production to protect their market shares, analysts say.

Morgan Stanley warns that if the kingdom was to lift production from the current level of 10.2 million barrels a day to 11 million barrels a day as threatened, while other players also show no restraint, “rebalancing could be pushed all the way into 2018.”

Read:Saudi prince says country could unleash a million barrels of oil a day

Back on Nymex, petroleum products ended mixed. May gasoline US:RBK6 fell by 2.5 cents, or 1.7%, to $1.437 a gallon while May heating oil US:HOK6 tacked less than half a cent to $1.236 a gallon.

Natural gas for May delivery US:NGK16 added 3.8 cents, or 2%, to $1.94 per million British thermal units.