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Energy Crisis: The OPEC Oil Embargo

The 1973 oil crisis proved our addiction to oil is crippling us.

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energy crisis

During the energy crisis of 1973-74, customers waited in line for hours to buy a few gallons of gas.

EPA/David Falconer

The world today is grappling with an energy crisis so complex and unwieldy its resolution seems remote at best -- and we have no one to blame but ourselves. No natural catastrophe or megalomaniac dictator can be faulted; this is a mess we made, and we were warned about it decades ago, during the oil crisis of the 1970s.

Some pundits claim the OPEC oil embargo of 1973, which initiated talk of an energy crisis, was just a political aberration that came and went. But as president and oilman George W. Bush stated in his 2006 State of the Union address, "America is addicted to oil." And the roots of our addiction go back many years, to the period before World War I.

Mideast Politics and the Energy Crisis

Great Britain has had an active interest in the Middle East since its imperial ambitions extended to India, Hong Kong and other Asian lands. The Suez Canal, which opened in 1869, connected the Mediterranean Sea with the Indian Ocean and was critical to Britain's economic growth.

Defending the Suez Canal was therefore a British priority, giving rise to British administration of the Mideast region known as Palestine. Great Britain cemented its influence in the Palestinian region following the fall of the German-aligned Ottoman Empire after World War I.

Great Britain and other Allied powers carved out a home in the Palestinian lands after World War II for the settlement of disenfranchised Jews around the world: Israel. The formation of Israel, an attempt at imperial largess, sowed the seeds for the countless, bloody Mideast conflicts that continue to rage unabated to the present day.

The 1973 Oil Embargo Strikes

One of these Mideast conflicts, the Yom Kippur War, started in October 1973 when Arab nations including Egypt and Syria attacked Israel during the Yom Kippur holiday. When the United States supported Israel in that conflict, the reaction from OPEC (the Organization of Petroleum Exporting Countries, made up primarily of Arab nations) was swift and decisive: they stopped almost all oil shipments to the United States.

The embargo, which soon extended to Western Europe and Japan, dealt a crippling blow to the world's economy even after the Yom Kippur War ended that October. By the end of 1973, the price of oil had skyrocketed from $3 per barrel to $12 per barrel, a 400% increase in a matter of weeks.

The oil embargo sent shock waves through the political, social and economic lives of much of the industrialized world. Long accustomed to cheap, readily available gas and oil, Americans now saw the price of a gallon of gas jump from roughly 0.39 cents per gallon up to 0.55 cents per gallon -- if there was any gas available.

'No Gas Today'

The shortage of gasoline resulted in worldwide gas rationing and hellishly long lines at gas stations -- if the stations were open at all. Many gas stations would sell only limited amounts of gasoline, to certain regular customers, and only on certain days. Theft of gasoline and other petroleum products became commonplace (before 1973, a locking gas cap was virtually unheard of).

Since oil also fueled electricity-generating plants, use of electricity was also sharply curtailed. Many states and cities banned Christmas lights in December 1973; some European countries outlawed boating, flying and driving on Sundays. British Prime Minister Ted Heath asked people to heat only one room of their house during the winter of 1973-74.

By February of 1974, some 20 percent of U. S. gas stations had no gasoline at all to sell; many simply went out of business. "Odd-even" gas rationing began: Cars with license plates that ended in an even number could buy gas only on even-numbered days, odd plates only on odd-numbered days.

The free-wheeling days of reckless oil consumption and American hegemony in global affairs had come to a screeching halt, it seemed.

Six months after it started, in March 1974, the OPEC oil embargo ended as Israel agreed to pull its troops back from the west side of the Suez Canal. Though supplies were once again plentiful, prices for gas and oil remained high, and have continued a general upward rise ever since.

Long-Term Impact of the Oil Embargo

The aftershocks of the 1973 oil embargo continue to the present day. The phrase "energy crisis" entered the world's lexicon almost overnight, as did the phrase "energy conservation." The nascent renewable energy industry was suddenly taken seriously by everyone from Wall Street to Main Street.

Soon, mass transit, carpool lanes and 55-mph speed limits were now seen as essential, even patriotic. In 1979, President Jimmy Carter installed solar panels on the roof of the White House, an act that would have been unthinkable in earlier administrations.

The oil crisis was a godsend to the Japanese auto industry. Long known for producing reliable, energy-efficient cars, Japan's automakers experienced a meteoric rise in sales and gained an important foothold in the lucrative American market. U.S. automakers, however, have lagged behind ever since, sealing the fate of the American auto industry.

The green movement, already an important political and social cause, gained new prominence as people began to see the foolishness of chasing after a limited supply of non-renewable fossil fuels -- and in the process destroying the planet.

But many political leaders, heavily influenced by oil industry lobbyists, turned the oil crisis into a problem of supply, not demand. It was our dependence on foreign oil that was the issue, so a push was initiated to exploit every possible source of oil, regardless of the risk to human health and the environment.

The Arab oil embargo also fueled a rising strain of jingoism among some Americans, and in 1986, in a powerfully symbolic act that has resonated for years, President Ronald Reagan had the solar panels removed from the White House roof. And we're paying the price for that short-sighted act of petulance even today.

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