The United States did not negotiate right away. Nixon tried implementing a new energy strategy called Project Independence: a project that would make a national commitment to energy conservation and develop alternative forms of energy. This plan would supposedly reduce America's reliance on foreign countries for oil, but only partially worked as the price per barrel of oil doubled and then quadrupled in America. The huge increase in oil prices was partly due to Arab hate for the US after they had supported Israel in the war, but also because the US dollar was losing its value. Since the price of oil was quoted in terms of the dollar, OPEC was losing revenue from their oil and thus increased oil prices.
As the US government was facing more and more pressure to fix the oil crisis in America from its people, the Nixon administration began parallel negotiations with key oil producers to end the embargo.The Nixon Administration also negotiated with Egypt, Syria, and Israel in order to arrange a pullout of Israeli troops from Sinai and Golan Heights. It was especially key for these negotiations to take place because it would help create peace between Egypt, Syria, and Israel. They needed peace between these countries in order to lift their oil embargo which would eventually happen in March 1974.
After the oil embargo was lifted, it taught the US government that US policy in the Middle East was very delicate as they needed to show support for the Israeli people and preserve ties with the Arab members of OPEC. If the US didn’t, they would suffer many economic consequences like they had experienced when only supporting Israel.
https://www.federalreservehistory.org/essays/oil_shock_of_1973_74
https://history.state.gov/milestones/1969-1976/oil-embargo
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ReplyDeleteI really like how you described the result and the lesson learned from the 1973 Oil Crisis as it really helps explain the results of what could have been a devastating event in American history. I was interested for why the 1973 Arab-Israeli or the Yom Kippur War broke out. Researching this, I found it was due to Egypt losing land to Israel following the Six Day War, such as the Sinai Peninsula, and desiring it back. And the cause of the Six Day War was the result of continued decline in relations, which is a common trend in the Middle East between Israel and the Arab nations. Since the Israeli state was proclaimed, friction has existed between the two religious groups. But in result of Egypt wanting territory back, it launched an invasion into Israel with the support of other Arab nations and the Soviet Union.
ReplyDeleteSources:
https://www.history.com/topics/middle-east/yom-kippur-war
https://www.history.com/topics/middle-east/history-of-israel
After looking into the crisis a bit more, what I found really interesting was the effect of the embargo on countries other than the US, particularly Japan. Initially, the embargo targeted Canada, the UK, the Netherlands, Japan, and the US, but Japan, having been experiencing extreme economic growth and being the second largest consumer of oil at the time, faced some interesting challenges. Although inflation rates seemed to have risen much faster in Japan than the US, they did not continue to increase like in the US. Having a much more flexible economy, Japan managed to recover from the crisis by reducing oil dependency and adopting new policies towards the Middle East. However, although they were successful in recovering, it seems like their economic growth stabilized afterwards.
ReplyDeletehttps://www.nytimes.com/1973/12/08/archives/japan-braces-for-a-fullscale-oil-crisis-japan-whose-busy-economy.html
https://www.japanpitt.pitt.edu/glossary/oil-crisis-1973
I thought this blog post was very good. One thing I wanted to investigate was how this oil crisis impacted the automobile industry. In the United States, before the crisis, cars were getting longer, lower, and wider with bigger engines. However, after the oil crisis, many gas stations did not have enough fuel to sell, creating long lines. In fact, some states had a system where if your license plate ended with an odd number, you could only buy gas on an odd day, and the same thing was for cars with license plates ending with an even number. Because gas was hard to get, people started looking for cars that would not consume gas at a fast rate. Thus, they started looking for more compact cars. This is what caused the shift from the larger sized vehicles to smaller cars.
ReplyDeleteSource:
https://driving.ca/auto-news/news/rearview-mirror-the-fuel-crisis-that-changed-the-industry
I thought that your post was very informative and laid out the events clearly. I decided to research further into the lifting of the embargo. I found that it was lifted in 1974 when Secretary of State Henry Kissinger negotiated a an agreement for military disengagement between Israel and Syria. It officially ended the Yom Kippur War.
ReplyDeletehttps://www.history.com/this-day-in-history/opec-enacts-oil-embargo
I thought this post was very interesting and explained in detail to create higher prices of American oil. I found that gas prices grew from $3 to $12 because of the oil emarbgo act and caused was one of the first effects seen from the American people.
ReplyDeletehttps://en.wikipedia.org/wiki/1973_oil_crisis
One major thing that I noticed from looking into the oil embargo a little further was how reliant many other western countries were on the negotiation power of the United States. Countries in Europe as well as Japan had stockpiles of oil but feared what could happen if the high prices and inflation continued. This left these countries reliant on the US to try to negotiate even though the countries were actively trying to distance themselves from the US policy in the Middle East. This shows how big of a role the US played in the West during the Cold War and how other countries could easily get dragged into the conflict.
ReplyDeleteSource: https://history.state.gov/milestones/1969-1976/oil-embargo