The Energy Crisis

Events in the next few years seemed to underline this theme. Billions of dollars poured into the coffers of the rock oil states, and were put to work in national development projects. In 1979, the Iranian revolution take to a second "oil shock," with a nonher surge of impairments and reel of gasoline shortages. Along with the Iranian guarantor crisis, American helplessness seemed underlined.

In the years since 1979, however, the appargonnt transformation of the 1970s has largely faded. World oil prices plunged in the early 1980s, and stayed low until the net few years, when they gradually recovered. OPEC has survived, but without the level of influence or unity it enjoyed in the 1970s. The economic transformation in the Arab origination has largely stalled, with oil income failing to bring the level of throw out once hoped for. The United States became more dominant in the mid-nineties than it was before 1973. Even the fear of a new capability crisis seems to have evaporated, al closely in a matter of weeks.

We are therefore led to ask what exactly really happened in 1973, and why? What effects did the Arab oil embargo of 1973-74 have, and why did it not have the effects so many people in both the Arab world and the West expected at the meter? This project is intended to briefly examine these inquires.

A. Domination by the "Seven Sisters" Oil Companies

Mendershausen, Horst (1975). manage with the Oil Crisis: French and German Experiences. Baltimore: Johns Hopkins.

1) The distribution of oil resources was largely unrelated to the distribution of population and economic infrastructure. Egypt, for example, though the most populous Arab country and the traditional center of Arab intellectual and ethnical life, has no oil, and thus drew no significant public assistance from oil income.

Egypt's economic problems remain much the same as before 1973: effectively harnessing the potential of its people.

Actually it was not the embargo itself that demonstrated this shift in the balance of power, but sort of the more durable increase in the world price of oil. The embargo was short-lived, and as noted above, there is an open question whether it ever existed in a functional sense, rather than as a rhetorical statement. Nevertheless, the embargo was "real" to the extent that it was sensed to be real, and the mere fact that it was so perceived by much of the world underlined and demonstrated that OPEC was now in the driver's seat.

The oil embargo played strongly into this psychology. Although the phrase "America held hostage" did not enter the political lexicon until the Iranian embassy crisis of 1979-80, the sense of besiegement was already widespread. The economic lifeblood of the United States was suddenly (or at least seemingly) revealed to be in the hands of distant countries of a foreign culture, whose peoples were the butt of an almost unrelievedly hostile stereotype.

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