Virtual synchronous generators (VSGs) have attracted widespread attention due to their advantage in supporting voltage and frequency of power systems. However, relevant studies have shown that a VSG has similar low-frequency oscillation as synchronous generators, which is more likely to occur under strong grid conditions. In this paper, the linearized mathematical model of a VSG is established by using small-signal analysis; based on this, the physical process of low-frequency oscillation of a VSG is explained from the perspective of vector motion. Firstly, the amplitude and phase motion of the current vector of a VSG under small disturbance are analyzed, then the mechanism of negative damping caused by terminal voltage control is revealed, and the reason why a VSG is more prone to instability under strong grid conditions is explained. Based on these, the influence of control and grid strength on the low-frequency oscillation of a VSG is analyzed. Studies show that the amplitude motion of the output current is the main cause of negative damping, and the oscillation can be suppressed by optimizing the value of key parameters.