I don't know much economics, but one thing I learned is that markets tend to not work as such when the players are few and motivated by other reasons than pricing. Airlines are one such example, depending on the time period, because being so few and dependent on entry barriers such as airport slots and flying licenses, they can easily collude. Oil producers are even more so, being driven by government decisions and geopolitics more than just profit alone.

So I wouldn't say that the oil market is broken, as much as it has never really worked as a close-to-ideal market.