Oil & Gas for dummies, page-41

Stefan,

a point which hasn't been mentioned is that it isn't easy, or in many cases possible, to turn off or reduce production. Many fields, including offshore producers, are linked to refineries via pipelines with take-or-pay contracts for the sale.
if the refinery isn't able to sell refined product they will soon run out of storage. They will then reduce production but still need to take-or-pay for the oil.
If they take, they will soon run out of oil storage, or they will need a buyer, adding to supply in the market. If they pay, the supplier will likely need to find a buyer to 'sell twice' the oil. Again adding to supply. They would be unlikely to reduce production as they still need to supply oil through the pipe tomorrow and in future.
Hence the US shale and other labour intensive production is where the reduction needs to come from, by drilling less wells.
Most producers cannot cheaply and safely stop producing and then start back up again. It is likely cheaper to keep producing and lose money on each barrell.

Oil sold in pipes doesn't hit the futures market, unless it is excess to the buyers needs. Hence the massive price drops (extra supply on the market) but slow price rises (no extra demand on market).