We are used to the ever-changing price of oil as one of the central indicators of the economy. Sometimes, the price is high, like in 2008, when a barrel cost over $120. Sometimes it is low (like in 2016 at $33/barrel). And sometimes somewhere in the middle (as it is now around $80/barrel). However, for almost three decades after World War II, permanently cheap energy fueled the post-war economic boom that has not seen its like again. Oil became the lifeblood of the global economy then and accounted for almost half of the global energy consumption in 1972. Initially, much of it came from American oil exports, but as American consumption grew, the country became an oil importer and the Middle Eastern countries picked up the baton as the leading oil exporters. But what would happen if that essential resource suddenly became expensive? The world found out during the oil price shocks of 1973. We’ll have a look at how the crisis came to happen and to be resolved, which short-term impacts it had, and how things turned out differently in the longer run. As always, expect board games!
The 1973 Oil Price Shock and its Consequences
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