U)+Oral+History+Research-+6.2.10

In the early 1970s the United States was launched into an oil crisis when the Arab members OPEC, Organization of Petroleum Exporting Countries, decided to punish the United States for supporting Israel in the Yum Kippur war. In 1973 the economy began to fall because of inflation pressure and the falling monetary system. In October OPEC began to negotiate with all the major oil companies to change the 1 971 Tehran price agreement fail. The United States continued with covert operations to supply Israel with weapons and supplies while the Soviet Union was doing to same for the Arabs. In mid October Saudi Arabia, Iran, Iraq, Abu Dhabi, Kuwait, and Qatar all raised their oil prices by 17% to $3.65 per barrel and they announced there would be production cuts. OPEC is now going to use oil as a weapon against countries who are helping Israel in the Yum Kippur war. They planned an embargo and major export cuts for those who did not comply. The Yum Kippur war ended on October 26 but the controversy over oil continued. Arab countries announced at 25% output cut as the embargo is spread to other countries. The price is then raised another 5% in December and then the prices were frozen until April. On January 18 Israel signs a withdrawal agreement to pull back to the east side of the Suez Canal.

The Cause for the major price increase for oil from the Arab countries in the middle east was caused by being dominated by industrial power in the west and they wanted to turn the flow of wealth around in their direction. They wanted to be able to establish wealth in developing nations in the middle east. There main targets were the United States, Great Britain, Japan, the Netherlands, and Canada. Japan suffered at 25% oil cut in production. In 1974 the United States price quadrupled to $12 per barrel. The shortage of oil caused a serious demand to address threats to the United States energy security. US oil companies tried to develop expensive oil by looking in rugged terrains such as the arctic. In 1973 a gallon of gas rose from 38.5 cents to 55.1 cents, states told people not to put up Christmas lights to conserve energy and it was even banned in Oregon. Nixon ordered for a gas rationing program where gassed would not be sold on saturday nights or sundays which caused major lines on weekdays. In 1974 20% of gas stations in the United States did not have gas at all. Rationing for gas took place by numbers on your license plates. If the last digit on your plates was odd then you could get gas on odd numbered days of the month. Cars with even numbered last digits could purchase fuel on even days of the month. Some gas stations used a flag method where if they had a green flag everybody was welcome to get gas, if they had a yellow flag then there were restriction on who could get gas then, or if they had a red flag which meant they were closed and had no gas. In some cases rationing lead to violence when some truck drivers began to protest against the rationing of fuel. In Pennsylvania and Ohio truck drivers who were not protesting were shot and killed by truck drivers protesting. In Arkansas truck drivers who were not protesting were attacked with bombs. Americas supply of natural gas decreased from 237 trillion to 203 trillion in just four years.

** After the embargo the United States decided that there was no way they would risk their national security again like that. So they established strategic oil preserves that were set up in New Orleans, Louisiana. These preserves were under ground salt domes filled with hundreds of thousands of oil barrels that were put in place there incase something like the embargo would happen again. The government wanted there to be some kind of back up plan in case the national security of the US was threatened again.

"1973 oil crisis." //Wikipedia//. Web. .

"Time Line of seventies, 1973." //in the 70's// n. pag. Web. 2 Jun 2010. . **