Declining oil prices

During the 1970s, the international oil prices experienced a six-fold surge, while domestic oil production in the USSR doubled due to the discovery of new oil reserves. This economic shift enabled the USSR to import substantial amounts of foreign machinery and consumer goods. From 1970 to 1985, the Soviet Union saw a significant increase in imports: clothing and footwear imports quadrupled, meat imports surged five-fold, and grain imports skyrocketed by a factor of twenty, accounting for about a quarter of domestic consumption.

However, after peaking in 1980, oil prices began a gradual decline, decreasing by approximately 50% over the next five years. In less than a year following the election of Mikhail Gorbachev, oil prices experienced another drastic drop of 50% within just a few months. As the value of Soviet exports plummeted, it became clear to the leadership that the country was in dire need of substantial economic reform.