Introduction
In our society, oil is one of the core requirements. Whether it is to drive from a point A to a point B or to fly between distant countries, oil always had a fundamental impact on our civilization. Its impact is felt, on a daily basis and under many aspects. Not a day goes by without hearing about the Brent's changing undulation, on the markets in New York or London. Some have thought that the desire to gain control of Iran's oil resources was the core of the CIA's intervention in that country, in the 1950s. In recent years, it was considered, by left-wing groups, that the war in Iraq was based upon an attempt of foreign control over the Iraqi petroleum resources. Even though both events have an unquestioned place within the region's politics and history, they will not be part of this paper's analytic structure. In lieu of that, it will talk about the 1973-1974 oil embargo and determine which theory could provide an explanation to such a move. This paper will elaborate on the previous embargoes used in the region's recent history, before thoroughly examine the 1973 embargo.
Regional history (1956-1973)
1956 : Suez crisis and Iranian oil nationalization
1956 marked the first time the Arab oil-exporting countries decided to use oil as a weapon, to achieve their political goals. That year, Egypt's Nasser decided to nationalize the Suez Canal. For the Egyptian leader, the Canal symbolized foreign exploitation, in Egypt. By doing such a move, the leader thought that he'd give an economic independence to his country. This move made by the patriarch of Nasserism caused retaliation from 3 military forces: the British, the French and the Israeli. On the other side of the Red Sea, Saudi Arabia saw all that was hap...
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...hs and ended at the Khartoum summit, in August 1967. During the summit, it was stipulated that “oil will not be used as a direct weapon against Israel’s Western protectors”. This was seen as a setback to Arab states. As a result of that decision, they had lost their solitary negotiating tool, oil. Nonetheless, the anti-Israeli sentiment of Arab states was still seen, during the summit, as “Arab states did not engage in any armistice or peace talks with Israel” (my translation). The 1967 war also caused a change in Egypt's foreign policy, since the positive neutralism of yore now became a dependence towards the Kremlin. In his book Le Proche-Orient éclaté, Georges Corm wrote that this war was not only an Arab loss against Israel, since “Nasserist, populist, socialist, Arab nationalist Egypt lost against the conservative, Pro-West, pan-Islamic Saudi monarchy.”.
The United States has had several scares throughout its history in terms of oil, most turn out to be over exaggerations of a small event. However, these scares highlight a massive issue with the U.S. and that issue is the U.S.’s dependence on foreign oil. Why does it matter that our oil should come from over seas? In a healthy economy this probably wouldn’t be as relevant, but the U.S.’s economy is not exactly healthy at the moment. There are 4 things that I would like to address: what the problem is, how it affects us, what some solutions are, and what solutions I feel are best.
As stated previously, the mission of Operation Ajax was to overthrow Mohammad Mosaddegh. Mosaddegh plans were to nationalize the Anglo-Iranian Oil Company that was partially owned by the British. By nationalizing Iran’s oil, Mosaddegh was insuring that his country would receive more income off their own oil while the British paid more. Britain was angry while America was worried and fearful of Iran turning communist. The past 50 years of Iran’s oil history is the key to understanding exactly why Mosaddegh wanted to nationalize Iran’s oil. Fifty-two years prior to the coup, the Shah of Persia, Mozaffar al-Din Shah Qajar, negotiated a deal with William Knox D'Arcy. D’Arcy acquired the right to prospect for oil for 60 years in a significant amount of Iranian territory. The amount of l...
In July 1952, the Egyptian government, headed by King Farouk, was overthrown in a bloodless coup led by the Free Officers, soon to be known as the Egyptian Revolutionary Command Council (RCC). The revolution was ostensibly led by Muhammad Naguib but it was clear that he was a mere figurehead and in a little over two years, Gamal Abdel Nasser would assume the Presidency. Although the goals of the RCC were somewhat unclear at the start, Nasser would embark on a policy of creating an independent Egypt free from internal and external domination. It was the latter goal that would set Nasser on a collision course with the West, initially Great Britain and to a lesser extent France, but eventually the United States. As such, Nasser’s commitment to autonomy would make him a hero to many in the Arab World and a villain to the West. Accordingly, for the next sixteen years Nasser and the United States would forge a strained relationship that at times bordered on mutual hostility and on other occasions, would stop just short of friendship based on pragmatic considerations by each side. As such, a detailed study is in order of the relationship between the RCC and the United States beginning with the Egyptian Revolution and ending with Nasser’s death in 1970. Ultimately, one can conclude that each side sought to exploit the other based upon outside considerations pertaining to Arab public opinion and a fear of communism.
People need oil for daily life and work. Since World War II, oil had caused many serious problems in United States and throughout the world. Remarkably, economic and social problems were heightened by the emerging energy crisis. By 1974, the United States gained a third of its oil by importing from the Middle East.[ James Oakes, et al. Of The People: A History Of The United States (Oxford University Press, 2011), 881.] When the heavy war between Israel and Arabia erupted, the United States was not able to gain enough petroleum because it supported Israel. To show the dissatisfaction with the United States’ support to Israel, Arab members of the Organization of Petroleum Exporting Countries even raised oil prices. “Overnight, OPEC raised the price of its oil from $3 to $5.11/By ”[ Merrill, Karen R.. The oil crisis of 1973-1974: a brief history with documents. Boston: Bedford/St. Martin's, 2007, 22.] Not surprisingly, the United States was strongly affected by the oil shortage and the the high price of oil. Homes and businesses could not easily solve the serious problem. Drastic protests occurred in many states such as Arkansas, New York, and Florida because a huge number of drivers could not accept the high price of gasoline.[ Merrill, Karen R.. The oil crisis of 1973-1974: a brief history with documents, 1.] Transportation was decreased in order to use less oil. Faced to the great challenge, several presidents analyzed the seriousness about the oil crisis and provided effective ways of reducing the use of oil.
On the 6th of October, a watershed event took place that changed history. It gave historians context to write about, politicians substance to reflect upon, and the world something to talk about. It was the 6th of October war, an Egyptian-Israeli war that took place on the 6th of October 1973 and ended on the Twenty-Fifth of October. One of the main reasons for Egypt starting the war was because it wanted to regain its territories back after the Israeli forces captured it in 1967 during the six-day war, “To understand this October War, one has to go back to the summer of 1967 when the Arabs, surveying the political and military wreckage wrought by the Six-Day War, found their armies broken and defeated and over one million brethren in the Sinai, Gaza Strip, West Bank, and Golan Heights under Israeli occupation. Besides the territorial and population losses, the Arabs had suffered a profound psychological setback in that they felt they had been humiliated and dishonored.” (O’Neill). However, there are opposing views when it comes to the victor of the 1973 war, was it Egypt or was it Israel? If one grew up in Egypt, one would find that Egypt was the victor of the war and vice versa in Israel, but what is the truth of this controversy? Even though both sides claim to be the winners, the real truth remains a mystery but research will uncover evidence that would make one decide who the true victor is.
During 1977, the leader of Egypt, Anwar Sadat, was ready to solve the conflict with palestine, and set up meetings with the Knesset, Israel’s parliament, and the Prime Minister Menachem Begin. While starting peace procedures, Jimmy Carter and the rest of the U.N. met with them, and they started to work on negotiations. Israel and Egypt had been fighting for several years before Jimmy Carter stepped in. The bulk of the conflict started in 1967 with the Arab-Israeli war. The war was sparked from tensions dating back to 1956, when after the Suez war, the Soviet
“One Arab nation from Gulf to the Ocean,” gives meaning to the term “Pan-Arabism” in the Middle East. A notion where Arab nations transcend their state boundaries to form political mergers with other states and achieve an ‘Arab unity.’ The existence of Arab states had been tumultuous throughout the decline of the Muslim order, the end of the Ottoman Empire, the Palestinian defeat, Six Day War and Arab-Israeli war in 1973. This essay will critically examine Foud Ajami’s case for a raison d’état in the Middle East and his claim that there were six broad trends leading to the alteration of the balance of power away from Pan-Arabism and towards the state. It will be argued that Pan-Arabism was a romantic ideology that Arab states found convenient to support, all in advancement of their nationalistic state agendas. It was never a realistic endeavor that was physically undertaken by the Arab states and was thus never alive in a tangible sense. However, Pan-Arabism as an ideology had a place in the Middle East and was thus alive in an ideological sense.
July 26 – The President of Egypt Gamal Nasser announces the nationalization of the Suez Canal. This is followed by the refusal of funding the Aswan Dam Project by the United States of America and the Britain. They blamed the state of the Egyptian Economy but many believe that it had more to do with Egypt’s decision to recognize China and buy weapons from Czechoslovakia, which at that time was controlled by the Soviet Union.
Campbell, Colin J., Laherrere, Jean H. "The End Of Cheap Oil." Scientific American Mar. 1998: 78-83.
...ed to nationalize the Suez Canal through which three fourths of all European oil is passed. After several months of negotiations Britain, France and Israel attacked Egypt and retook the canal. United Nations condemned their actions and forced them to give up the canal to Egypt once again. As a result of the Eisenhower convinced Congress to approve the Eisenhower Doctrine that would “assist any nation in the region that required aid against aggression from any nation controlled by International Communism.” The Eisenhower administration was very careful not to alienate any Middle Eastern countries that could provide the country with a steady supply of oil and this affected his foreign policy and the policy of containment.
Andersen, Roy, Robert F. Seibert, and Jon G. Wagner. Politics and change in the Middle East: sources of conflict and accommodation. 9th ed. Englewood Cliffs, N.J.: Prentice-Hall, 1982. Print.
Many factors determine the supply and demand of oil in the short-term and long-term range. First, conflicts that occur in the world influence the supply and demand of oil. For instance, the onset of the United States of America Civil War brought about a surge in prices and demands of oil. It amplified the effects on the oil market by the cut-off of supplies of turpentine from the South and the introduction of a tax on alcohol, which rose from 20¢/gallon in 1862 to $2/gallon by 1865, in contrast to the 10¢/gallon tax on products derived from petroleum. Assuming a yield of about 20 gallons of oil per barrel of crude, each 10¢/gallon tax disparity on petroleum product cost of two dollars per barrel, which was a competitive advantage for oil. Because of this, the tax eliminated alcohol as a competitor to petroleum. As a result, oil production declined after 1862, even as new demand pressures grew. Other conflicts that affected the supply and demand of oil include the OPEC embargo that happened between 1973 and 1974, when Syria and Egypt attacked Israel. Others are the Iraq-Iran war between 1981 and 1986, the first P...
Initially and primarily the US’s influence in the Middle East was to prevent a hostile power from gaining control over a vital resource. With the outbreak of the 1973 Arab-Israeli conflict, the perception of oil as a strategic commodity surfaced. The Arab states cut off all petroleum deliveries to the United States and forming cutbacks to other countries. At the same time, the Organization of Petroleum-Exporting Countries (OPEC) announced a rapid increase in the pr...
...s the Arabs’ nightmare. In 1973, Saudi Arabia, Egypt, and Syria decided to fight against Israel to revenge Arabs’ defeat which was in 1967. The plan was that Egypt and Syria would battle by the military while Saudi Arabia would use oil as a weapon. The result was Saudi Arabia stopped supplying oil to the USA. It took a while to settle the conflicts down. Eventually, the relationship was rehabilitated.
The event that led to the beginning of Yom Kippur War was when Egypt launched Operation Badr. From there it came to a halt but when President Anwar Sadat launched an attack through the Sinai Mountain passes, it totaled in Egyptian loss without achieving a purpose. From this failed mission, it made the Israelis think that they had a chance of beating the Egyptians so they launched Operation Abiray-Lev, which was Israelis trying to cross the Suez Canal so that they could close in the Egyptians forces towards the east side to stop there supply line. Soon after, the Israelis had some problems of trying to establish a corridor to the canal because they undermined the strength of the Egyptian forces. By October 18 there were three Israeli armored divisions across the canal, one of the divisions moved forward toward the north to invade Ismailia, while the other two went towards the Suez City.